BiggerPockets

There's one big thing that Patrick leaves out of his training (and the lawyer on his training (I'm a PMOD member) agrees) is that as of now, it costs as much as 13,000 to have the right disclosures and PPM even when you FIND the money.
But he has done better than other Guru's at how he's put together his information and what information there is.

PPM or CPPM stands for Private Placement Memorandum. That is the document[s] that you will need, along with some disclosure documents, if you want to get serious about raising private money from people. Some people would say "oh it's just my Uncle, he's not going to sue me" and then a deal doesn't go well and guess what, Uncle's only recourse is disown you and/or sue you. Plus, as Patrick will teach and it should become common sense to anyone raising money, you need to make sure your investors are accredited. Just like a real estate deal, you have to be willing to say NO to taking someone's money. I've gotten into situations where on a referral I ended up taking some guy's last 35k! Can you imagine if the deal hadn't gone well?!
That's what you pay 13,000 for. People always want to save money (including myself) by cutting corners and not being patient enough to set themselves up right. There's plenty of deals out there and there will be for some time. In the end, you'll be glad you did it right.

Let me say this about Patrick's training. I understood what he's teaching right from the start. I was able to pull 24 solid leads from the public records in less than 4 hours work. Not only is it going to take some time, but those leads STILL don't know me. A lot of times you're going to find mortgagee's who are parents that lent to their kids or some other family situation. These people aren't "real estate investors" so you're still going to have to build a relationship that makes them comfortable with investing with you. That's if they even call you! Ultimately you have to be careful how much money you spend trying to learn how to build relationships from a Guru. A $300 psychology class might do just as well.

I got carried away with this response, but hopefully that helps.

You all saying that this guy charges $13,000 for a how to? OMG!!!

Does anyone use local attorneys anymore, or do investors have some guru worship syndrome?

Locally, I know of three guys who have gotten burned, two went to prison for fraud, on fined and it all began from seeking investors improperly. I would not say that they actually had ill intentions starting off, it's that things snowballed, is probably more like it.

Consider that allpeople die, even the people you do business with. While your "investor" may understand what you are doing and fully agree, their heirs may not!

If you even appear to the grandkids that you did something that causes them to receive less from grandpa, be prepared to defend what you said, wrote and did.

I really doubt that any guru is showing the big picture for accredited investors and money partners.

I ran over 16 investor types through 4 different businesses, not counting investment companies and institutional investors. I had a heavy financial background before starting the companies and I went through several attorneys in Mo., Ar. Ks. and Il, , including estate planning and securities law and it did not cost me $13,000.00, initially and that's as a lender!

Good luck

I want someone to show me a person who filed documents with the SEC. A PPM, Regulation D, or Offering Circular for instance. Just provide the link, please, and I'll vote you up! I'm looking for something in context, especially for a single person doing a single deed of trust or mortgage, although perhaps (most likely) doing this many times. Hint. SEC filings are publicly searchable. I provided a link to a SEC filing specifically for real estate flip investing company (now defunct) in the second page of this BP forum post.

I think the guys selling the SEC compliance stuff have it figured out. Scare people about SEC jail time, then sell tapes and books. That's where the money is.

Thanks for the note Jerry, glad it helped! :D

It's good to hear from you, Ryan. It's been awhile! Thanks for clearing up a few issues on this topic. I have to admit, it's a bit out of my realm but felt the need to address it since the topic keeps coming up with folks over and over again.

Thanks everyone for taking the time to read this post. Have a great week! :D

I don't think anyone seeking financing for a single deed of trust need register a securities offering, as plenty of exemptions to registration - state, private placement, size are available. Where SEC registration possibly comes into play is for a mortgage pool, or equity participation of a major real estate acquisition. In truth SEC registration is cost prohibitive for smaller transaction when legitimit and quite legal and much less expensive alternatives are available. However there is a big difference between SEC registration and being SEC compliant. I may choose not to register my offering with the SEC, but I do want to comply with there regulations which would begin with having my offering comply with the exemptions from registration.

You don't have to intend to register an offering to value learning the entire securities process. Knowing what constitutes a legal exempt from registration offering, and all this entails, is as or more valuable.

However, as Bill Gulley states, more actuate and relevant information can be obtained my paying for two hours time of a local attorney well versed in securities regulation. Why pay for a seminar, travel to a distant city, sit in a classroom with 100 other participants, listen to a bunch of answers to a bunch or questions not relevant to your particular situation, when you can get individualized one on one learning available with a local attorney? I think perhaps many real estate investors believe that the "gurus" will give you the inside dope and the attorneys will just recite the law. Actually, in this area of law it is interpretation which is curcial.

Two words: Land Trust.

Some here will tell you it is illegal to solicit funds through the newspaper. Well, then, don't. Solicit a business partner instead.

Your newspaper ad, even if it says earn ?% on your money, is not always a solicitation for funds in a securities scheme. And your ad doesn't have to have anything to do with borrowing and lending. I say, screw you SEC! My ads are an invitation to learn how to become a real estate investor, more specifically, a real estate investing partner who happens to put up all the funds for the purchase and resale of a property. The funds are not a loan; they are purchase funds used by your new partner to purchase real estate, which they will own as a beneficiary of a trust. The property is not collateral nor security for money received, mainly, because YOU don't receive any money from the partner. Hopefully, if you buy right, you will receive a portion of the resale profit as a beneficiary paid by the trust as agreed.

And I've said this before, but it bears repeating. Ask ten different attorneys the same question regarding complex legal structures or any other subject, which may be construed as unconventional, complicated or viewed as questionable, and you will likely get ten different answers. The legality of land trusts is not defined by personal interpretation or opinions; the law is defined by statutes. Where specific statutes do not exist, interpretation falls to common law.

Educate YOURSELF.

previous relationships, that's the key to not get in trouble!, join local r.e. investment clubs and after attending few meetings talk to other fellow members there. Show your plan and numbers, make relationships, that's it! ..cheaper than spending 13k+!

There is a difference between a Private Placement and a JV. $13,000 for the disclosures and PPM is quite reasonable. We expect to pay about double that for a properly compliant PPM