I don't know why I should trust 'some guy on the internet' over what my legal team is telling me.
The Wisdom of Crowds comes to mind, just like the convos found elsewhere concerning a dude with a similar MO seeking advice and sharing experiences:
http://www.wickedfire.com/shooting-shit/177042-building-real-estate-empire-2.html#post2179878Assuming funding stalls, why not issue more shares at that time?
With your current numbers you're simply ripping off your investors. The returns they're getting is not worth the implied risk. Note: I admire your ability to convince investors that they're making good returns, however let's be honest -- they're not.
Based on your numbers:
$400k raised
$6.1k gross income -- assuming 100% occupancy.
6.1*12 = $73.2k gross annual income
$73.2*.3 = $21.96 going to the investors
assuming expenses of $0, then their return equals $21.96/400 = 5.49%
Seeing as the risk with such an investment is insanely high (30 of the 40 companies went under), a 5.49% return is nowhere close to justified.
Furthermore, when you calculate expenses + income tax, then it's likely your "investors" will get slightly above a 2% return.
...
With that said, let's calculate your assumed profit for this year:
$73.2*.7 = $51.24k in rental income. Obviously expenses have to be deducted from this, but let's assume you're left with $20k.
On top of that, you now own $450k in assets. $450k * .7 = $315k.
So far this year you've earned $315k + $20k = $335k. Your investors on the other hand have not.
Once again, I admire your hustle.
But, who am I to argue with success when the dude that the above was directed toward purchases houses via paying for them with Bitcoin:
http://www.reddit.com/r/Bitcoin/comments/21tygc/irs_should_give_guidance_on_like_kind_assets_for/cggz62ePossibly, although thus far I've bought 5 houses via bitcoin and set to close on #6 in a week or so.
Brandon, if for some reason funding ceases via this avenue, this dude on YouTube, also name Brandon, will show you how to earn $8,000 a day via the
Google Money System.
Whatever happens, make sure you stay off of John T. Reed's (rhymes with John Kenton Freeman) shit list:
http://www.wickedfire.com/shooting-shit/167067-would-you-interested-real-estate-investment-trust.html#post1912505I'll have to go through my inherited pile of "Millionaire real estate investor for 0% down" books that I somehow inherited from family members.
When I checked a year or two ago, there were a few prolific REI guys who wrote books who are now in jail. Carleton Sheets was one of them that almost wound up in jail. I know quite a few of his followers did because he essentially was showing people how to lie on FHA documents for 0% down financing on investment homes.
Edit : Several of Robert Allen's followers were also arrested.
Edit 2 : Here's a list of guys that are in jail, arrested or otherwise legal limbo who have been involved in REI books : http://www.johntreed.com/Reedgururating.html In closing (no pun intended), a blast from the past:
http://www.biggerpockets.com/users/schockergd ~~~
http://www.biggerpockets.com/forums/48/topics/12654-first-deal-
I wish I had a brother that made $129,905 A Day:
http://www.wickedfire.com/shooting-shit/157349-129-905-day.html
Apologies for not yet linking where the dude above and his brother own a Litecoin Pharm, but that's probably not important.
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