New to Multifamily Investing and looking for some answers, we got it all covered, right here.
Who is an Accredited Investor?
In the U.S, the definition of an accredited investor is put forth by SEC in Rule 501 of Regulation D.
As Sec defines: to be considered an accredited investor, one must have a net worth of at least $1,000,000 excluding the value of one’s primary residence or have income at least $200,000 each year for the last two years or ($300,000 combined income if married) and have the expectation to make the same amount.
What Is A Sophisticated Investor? Can They Also Invest?
A sophisticated investor is one who has sufficient capital, experience, and net worth to engage in more advanced types of investment opportunities and can evaluate the risks and merits of an investment. The sophisticated, non-accredited investors are allowed to invest as long as they have a pre-existing relationship with the sponsor.
What type of accounts can I invest with?
We currently support personal investment accounts, joint accounts, and certain entity accounts (Trusts, Limited Liability Companies, Limited Partnerships, C Corporations, and S Corporations). For more information on IRA accounts, see below.
Can I invest through my IRA?
Yes, you can invest through your IRA. If you currently have a self-directed IRA, please check with your current custodian to ensure that they will allow you to place your investment with Loomba Investment Group LLC.
Can I Visit The Property?
Yes. Investors are allowed to visit the property before investing and during the life of the project.
What is a K-1?
As a partner in the LLC that purchases the properties, you will receive a K-1. A K-1 is a tax form used by partnerships to provide investors with detailed information on their share of a partnership’s taxable income. Partnerships are generally not subject to federal or state income tax, but instead issue a K-1 to each investor to report his or her share of the partnership’s income, gains, losses, deductions, and credits. The K-1s are provided to investors on an annual basis so that each investor can include K-1 amounts on his or her tax return.
What Exactly Are The Funds Used For?
Investor funds are used for the total acquisition cost of the property. This includes but is not limited to the actual purchase price of the property, acquisition fees, legal and transaction costs, capital projects, and reserves.
How long will my money be needed?
This is determined by the specific property and improvement plan and will be specified in each property offering. Typically we intend to hold properties between 3-7 years.
Each property has an anticipated rate of return and a proposed exit strategy. For example, our strategy may be to hold a property for 4 years OR until we hit a specific appreciation hurdle. The first of these two factors to hit will cause us to sell the property and pay off our investors with available proceeds.
How Frequently Are Distributions Made?
Distributions are planned quarterly.
How Are Investors Compensated Upon A Refinance?
Upon a refinance, any proceeds received will go directly back to investors, paying down their initial principal. It decreases investors’ initial equity exposure while maintaining their pro-rata share of ownership within the deal.
Will I be involved in the daily management of the property?
No, the members of Loomba Investment Group, LLC and its affiliates oversee the management of the properties/assets and execute the improvement plan. We will hold regular conference/webinar calls to update investors on the property status. We send regularly executive summaries and financial reports. We are easily reachable and always open to discuss any issues/concerns with the investors.
How Do I Start Investing With Loomba Investment Group?
Please register and schedule an introduction call. Once you are added to our list you will receive newsletters, educational material, and announcements explaining what you need to do in order to partner with us on a specific deal.