You submit your registration form, complete a brief online investor questionnaire and schedule a convenient time to speak with us by phone. Once these three steps are completed, we’ll provide you with your login information, giving you instant access to deals and investment opportunities.
Both accredited and non-accredited investors.
Our real estate Fund, called SyndiCap, makes first-priority mortgage loans for short-term acquisition and construction of for-sale residential and commercial properties; fix and rent; and limited number of short-term bridge and mezzanine loans. After the loan is made, information about the real estate project and the underlying mortgage loan is posted on our investment platform, and an offer is made to investors to purchase notes in fractional amounts of the underlying mortgage loan.
A note spells out the terms of a short-term loan contract, such as interest rate and the repayment term.
A 1-year Treasury Note and a 1-Year CD are examples of short term loan contracts.
In September 2017, the yields on 1-Year Treasury Notes and 1-Year CDs were less than 1.3%. On our Site investors earn an 8% annualized rate.
When we make a mortgage loan to a real estate professional, we make the loan at a maximum loan-to-value (LTV) of 70% and the borrower grants us a first-priority mortgage. A mortgage is a debt instrument, secured by the collateral of the real estate property. It is also referred to as a lien against the property or a right to collect payments or upon default to foreclosure.
When we collect from the borrower, we make payments to note buyers. For example, if the valuation of a real estate project is $500,000, our maximum loan would be $350,000 (70%). If the project took 12 months to complete and sell, we would need to collect $378,000 to enable note buyers to realize their principal investments and interest at 8%.
$350,000 x 1.08% = $378,000.
In this example, $378,000 is $122,000 less than the project’s valuation, or 75.6% of $500,000.
To further reduce the perceived risk of an investment (the purchase of a note), we have decided to limit the offer of notes to 80% of the principle amount of our mortgage loan. These means that we make a loan and hold 20%. This also means that the effective LTV on your note is 56% or less (70% x 80%). This translates as follows:
80% of $350,000 = $288,000
$288,000 divided by $500,000 (project’s valuation) = 56%
$288,000 x 1.08% = $311,040
In short, a project with a valuation of $500,000 would have to sell for less than $311,040 before there would be any risk that investors would not be repaid 100% of their principal investment plus 8% interest.
And it gets better. We pay note buyers monthly interest starting with the date we receive your investment.
Only you can decide if that is a risky investment.
The minimum investment amount is typically in the range of $4,000 to $6,000, depending on the amount of the underlying mortgage loan.
The annualized rate is 8%. If after purchasing a note you refer an investor who makes an investment, your annualized rate will be increased to 9%.
Yes. You can set up a self-directed IRA or a self-directed 401 (k) account to invest in private investment offerings on our Site.
Yes. We provide you with a tool that we call a Dashboard to keep track of all the investments you make at our Site.
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Our Site offers real estate developers and operators the opportunity to apply for loans, and offers qualified investors the opportunity to invest in real estate. However, Crowded House Capital does not make recommendations regarding the appropriateness of particular opportunity for any particular investor. We are not investment advisors. Investors must make their own investment decisions, either alone or with their personal advisors.
Real estate can be risky and unpredictable. For example, many experienced, informed people lost money when the real estate market declined in 2007-8. Time has shown that the real estate market goes down without warning, sometimes resulting in significant losses. Some of the risks of investing in real estate include changing laws, including environmental laws; floods, fires, and other Acts of God, some of which can be uninsurable; changes in national or local economic conditions; changes in government policies, including changes in interest rates established by the Federal Reserve; and international crises. You should invest in real estate in general, and in the opportunities listed at the Site in particular, only if you can afford to lose your investment and are willing to live with the ups and downs of the real estate industry. We may provide financial projections for some of the investment opportunities listed on the Site. All such financial projections are only estimates based on current conditions and current assumptions. The actual result of any investment is likely to be different than the original projection, often by a large amount. Neither Crowded House Capital nor anyone else guaranties the results reflected in financial projections.
Neither the Securities and Exchange Commission nor any state agency has reviewed the investment opportunities listed on the Site. Thank you for using the Site. If you have questions, please contact us at firstname.lastname@example.org.