Joint Venture Issues with fix and flipper
Flipper/Rehabber · San Francisco USA · Member since 2024 · 7 posts · 2 votes
Joint Venture Issues with fix and flipper
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Dan H.Pro Member
Investor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votesI am not involved in this effort, but i have been consulted on if there is a viable means of saving this effort.
I believe the following all via hearsay. I have not heard from all principles. One principle in particular, I have it heard their side. So all of this is what I have been told, most I have not verified (but i have seen the current pictures and 3 rehab quotes (calling one of the 3 a quote is being generous but it did have a price)):
- that effort was in trouble before your investment. They should not have been bringing in new partners on to the sinking ship. suspect the they is one particular partner that you can likely guess.
- it appears a partner (I will call partner a, you can likely guess who the principles point to as partner a) has brought in partners beyond what other partners were aware and seems to have ghosted the partners. At least this is what is stated by some of the principles (partners/lenders). I have not heard the partner a’s side of the story.
- there are lenders that lent money without any collateral or personnel guarantees. There is a transitive nature of trust in the lending on this effort. Lender A trusted lender b who trusted partner a. These lenders likely are going to lose their investment. Friendships have been severed.
- One of the unsecured lenders is looking into every option to recover something or at a minimum to make sure that anyone who behaved unethically is going to find it difficult to do so in the future.
- have you seen recent pictures of the property? Purchase was $350k. It is virtually demoed (I have seen pictures) and market has fallen a little. Current property value is far below acquisition costs. The investor contributions and lender provided money far exceeds this value. My belief is it likely is 2x this value which would be less troubling if there was a large sum of money sitting somewhere that is still associated with this effort.
- it is delinquent to the primary lender in first position who has started default processing. I was told when it was first initiated but do not remember the exact date but it was close to when you state you invested.
- I suspect the gps have legal exposure. It seems like all principles point to the same person as screwing everyone (not including trusting someone that did not thoroughly vest other people).
- are you aware of the rehab initial estimate (that I could tell instantly from the pictures was far too low and that was not even including the historical designation ($40k+ for windows)). Are you aware of the current rehab estimates? They varied greatly, the lowest was too low. The others could be high; some line items seemed high).
- partner a has at least 4 other projects, one of which I have been told is as bad as this one. I have not been asked to look at it, but I find it difficult to believe another project could be this bad.
Unfortunately, it is my belief your $25k is not worth pursuing. There are a lot of people losing money on this “deal”. Some of the partners indicate they do not know about some of the LPs. Lots of mistakes but what sets this apart is the level of trust without verification of some operators/lenders that should know better but were dealing with “friends” they thought they could trust. One lender in particular I question if she has ever lent real money without any guarantee prior to this. I know she will not be doing so in the future.
Sorry about your financial loss. I am unsure of what vetting you did, but one principle has searchable out of country issues. Most of the principles seem to be victims (at least from what I was told).
Best wishes
17 Replies
- 5moPeter MckernanBusiness MemberResidential Real Estate Agent · Irvine, CA · Member since 2013 · 2k+ posts · 1k+ votes
I am not sure who this is, but it sounds like you need to hire an attorney to send these "JV partners" a demand letter and then move forward with a lawsuit if they are in violation of an agreement along with not responding when you committed money to a transaction too.
The McKernan Group4.957 Reviews - Flipper/Rehabber · San Francisco USA · Member since 2024 · 7 posts · 2 votes5mo
Thanks, i have been thinking about that,only. issue i hope i wont have to spend even more money on lawyer fees without getting my money back
- Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes5mo
Sounds like you got scammed. What due diligence did you do to investigate the partners?
- Flipper/Rehabber · San Francisco USA · Member since 2024 · 7 posts · 2 votes5mo
I met them at a meetup; they usually go to different properties that they are flipping or have flipped in the past. One of the partners, "Mary McGynty," is the main organizer of the meetup and is now trying to distance herself from Africa, the developer. They are both currently partners on another project, also. During the meetup, I met someone who claimed to have also invested in a current project with them.
- 5moG. Brian DavisPro MemberInvestor · Hatboro, PA · Member since 2016 · 3k+ posts · 866 votes
That's a tough spot. At this point I'd move from informal outreach to a documented, formal process. Send a written notice (email and certified mail) referencing your JV agreement and the missed reporting obligations, with a clear deadline to respond. Start gathering all documentation now in case you need to enforce the agreement or move to arbitration.
You could also check permit activity or local records to see if work is actually progressing. Lack of communication is a red flag on its own, so I’d assume you may need to protect your position. Situations like this are exactly why our co-investing club spends a lot of time vetting operators and requiring consistent reporting before anyone invests. It doesn’t eliminate risk, but it helps reduce surprises like this.
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes5mo
As mentioned get an attorney, and if they don't communicate see if you can put a lien on the property or somehow cloud title based on the agreement (don't do this without attorney). That is a way to get them to jump
7e investments53 Reviews - 5moRyan ThomsonBusiness MemberReal Estate Agent · Colorado Springs, CO · Member since 2018 · 1k+ posts · 1k+ votes
The most common JV blowup I've seen with fix and flippers comes down to one thing: the operating agreement didn't define decision-making authority before a single nail was swung.
Here's what usually goes wrong. The money partner assumes they have veto power on every contractor decision. The operator assumes they have full autonomy to run the project. Both are technically right based on a vague verbal agreement, which means neither is actually right.
A few things worth locking down before you're mid-renovation:
1. Who controls the LLC (or whose name is on the entity)?
2. What's the approval threshold for unbudgeted expenses? $500? $2,500? Define it.
3. Does the operator get paid during the project or only at closing?
4. What happens if one partner wants to sell and the other wants to hold?
5. Is there a forced buyout mechanism if you deadlock?
If you're already in the deal and hitting friction, the fastest path forward is usually a real estate attorney who can mediate, not one who charges $400/hour to escalate the fight. A lot of these disputes get resolved quickly once both parties have to articulate their position in writing.
The other thing nobody talks about: if the flipper is also acting as GC and pulling permits, make sure you've got clarity on who carries liability if something goes sideways during inspection.
What specifically is blowing up? Budget overruns, scope disputes, profit split disagreement? The fix depends a lot on which problem you're actually dealing with.
The Assumable Guy544 Reviews - Investor · Austin, TX · Member since 2021 · 497 posts · 127 votes5mo
Sorry you're dealing with that. Once reporting stops and communication goes quiet after funding, it's definitely something to take seriously especially with a JV rehab deal like the Sacramento property.
I haven’t worked with Bonic Homes or Africa Estrada personally, but before jumping straight into arbitration, I’d probably verify whether work is still progressing on-site and pull updated property/activity records if you haven’t already.
I’ve seen situations where investors later move toward more structured lending or draw-controlled financing to avoid this exact issue on future projects.
Have you been able to confirm whether any rehab activity is still happening at 1425 D Street?
- 2moDan H.Pro MemberInvestor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
I am not involved in this effort, but i have been consulted on if there is a viable means of saving this effort.
I believe the following all via hearsay. I have not heard from all principles. One principle in particular, I have it heard their side. So all of this is what I have been told, most I have not verified (but i have seen the current pictures and 3 rehab quotes (calling one of the 3 a quote is being generous but it did have a price)):
- that effort was in trouble before your investment. They should not have been bringing in new partners on to the sinking ship. suspect the they is one particular partner that you can likely guess.
- it appears a partner (I will call partner a, you can likely guess who the principles point to as partner a) has brought in partners beyond what other partners were aware and seems to have ghosted the partners. At least this is what is stated by some of the principles (partners/lenders). I have not heard the partner a’s side of the story.
- there are lenders that lent money without any collateral or personnel guarantees. There is a transitive nature of trust in the lending on this effort. Lender A trusted lender b who trusted partner a. These lenders likely are going to lose their investment. Friendships have been severed.
- One of the unsecured lenders is looking into every option to recover something or at a minimum to make sure that anyone who behaved unethically is going to find it difficult to do so in the future.
- have you seen recent pictures of the property? Purchase was $350k. It is virtually demoed (I have seen pictures) and market has fallen a little. Current property value is far below acquisition costs. The investor contributions and lender provided money far exceeds this value. My belief is it likely is 2x this value which would be less troubling if there was a large sum of money sitting somewhere that is still associated with this effort.
- it is delinquent to the primary lender in first position who has started default processing. I was told when it was first initiated but do not remember the exact date but it was close to when you state you invested.
- I suspect the gps have legal exposure. It seems like all principles point to the same person as screwing everyone (not including trusting someone that did not thoroughly vest other people).
- are you aware of the rehab initial estimate (that I could tell instantly from the pictures was far too low and that was not even including the historical designation ($40k+ for windows)). Are you aware of the current rehab estimates? They varied greatly, the lowest was too low. The others could be high; some line items seemed high).
- partner a has at least 4 other projects, one of which I have been told is as bad as this one. I have not been asked to look at it, but I find it difficult to believe another project could be this bad.
Unfortunately, it is my belief your $25k is not worth pursuing. There are a lot of people losing money on this “deal”. Some of the partners indicate they do not know about some of the LPs. Lots of mistakes but what sets this apart is the level of trust without verification of some operators/lenders that should know better but were dealing with “friends” they thought they could trust. One lender in particular I question if she has ever lent real money without any guarantee prior to this. I know she will not be doing so in the future.
Sorry about your financial loss. I am unsure of what vetting you did, but one principle has searchable out of country issues. Most of the principles seem to be victims (at least from what I was told).
Best wishes
- 2moJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Dan H.:
I am not involved in this effort, but i have been consulted on if there is a viable means of saving this effort.
I believe the following all via hearsay. I have not heard from all principles. One principle in particular, I have it heard their side. So all of this is what I have been told, most I have not verified (but i have seen the current pictures and 3 rehab quotes (calling one of the 3 a quote is being generous but it did have a price)):
- that effort was in trouble before your investment. They should not have been bringing in new partners on to the sinking ship. suspect the they is one particular partner that you can likely guess.
- it appears a partner (I will call partner a, you can likely guess who the principles point to as partner a) has brought in partners beyond what other partners were aware and seems to have ghosted the partners. At least this is what is stated by some of the principles (partners/lenders). I have not heard the partner a’s side of the story.
- there are lenders that lent money without any collateral or personnel guarantees. There is a transitive nature of trust in the lending on this effort. Lender A trusted lender b who trusted partner a. These lenders likely are going to lose their investment. Friendships have been severed.
- One of the unsecured lenders is looking into every option to recover something or at a minimum to make sure that anyone who behaved unethically is going to find it difficult to do so in the future.
- have you seen recent pictures of the property? Purchase was $350k. It is virtually demoed (I have seen pictures) and market has fallen a little. Current property value is far below acquisition costs. The investor contributions and lender provided money far exceeds this value. My belief is it likely is 2x this value which would be less troubling if there was a large sum of money sitting somewhere that is still associated with this effort.
- it is delinquent to the primary lender in first position who has started default processing. I was told when it was first initiated but do not remember the exact date but it was close to when you state you invested.
- I suspect the gps have legal exposure. It seems like all principles point to the same person as screwing everyone (not including trusting someone that did not thoroughly vest other people).
- are you aware of the rehab initial estimate (that I could tell instantly from the pictures was far too low and that was not even including the historical designation ($40k+ for windows)). Are you aware of the current rehab estimates? They varied greatly, the lowest was too low. The others could be high; some line items seemed high).
- partner a has at least 4 other projects, one of which I have been told is as bad as this one. I have not been asked to look at it, but I find it difficult to believe another project could be this bad.
Unfortunately, it is my belief your $25k is not worth pursuing. There are a lot of people losing money on this “deal”. Some of the partners indicate they do not know about some of the LPs. Lots of mistakes but what sets this apart is the level of trust without verification of some operators/lenders that should know better but were dealing with “friends” they thought they could trust. One lender in particular I question if she has ever lent real money without any guarantee prior to this. I know she will not be doing so in the future.
Sorry about your financial loss. I am unsure of what vetting you did, but one principle has searchable out of country issues. Most of the principles seem to be victims (at least from what I was told).
Best wishes
correct conclusion to small of an investment to warrent litigation or hiring a West coast lawyer at 400 to 600 an hour..
- 2moDan H.Pro MemberInvestor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
I was told one of the principles has moved out of their home and disappeared. I understand a PI could not find her. Nothing looks more guilty of intentional fraud, vs just a poor investment, than fleeing.
I believe they are likely in Spain. Pure speculation based on where she has completed some RE deals in the past.
I got some of the info, far less than I got on D steeet, on a 2nd very similar investment gone bad with some of the same principles. It is also in Sacramento. It also seems financially prudent to let the lender take the property (more is owed than property is worth).
I have been told that there are 2 additional properties in similar situation. I know nothing about these 2 except they are also supposedly struggling.
It seems a lot of people are loosing money on these investments. Too much trust on the wrong people (possibly, primarily a single person).
In hind site it is easy to see lots of errors were made. But the errors were virtually all the result of displaced trust. Even the initial (absurd) rehab estimate was not questioned due to trust.
Be careful who you partner with. ALWAYS vet the principles and the project.
- 2moNichole KinardPro MemberMember since 2024 · 13 posts · 9 votes
I also lended $100K to Bonic Homes on 3161 X St and just received notice that the 1st lien holder has filed a Notice of Default. I am also trying to determine if hiring an attorney is worth the thousands it will cost. Nicole Fisher, whom I met in a RE mastermind, organized the loan and is also unable to contact Africa or Johnny Estrada.
It seems like if it's a scam and enough people got screwed, we could do an international manhunt, find her and hold her accountable. Or maybe that's just in the movies.
- 2moDan H.Pro MemberInvestor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
Quote from @Nichole Kinard:
I also lended $100K to Bonic Homes on 3161 X St and just received notice that the 1st lien holder has filed a Notice of Default. I am also trying to determine if hiring an attorney is worth the thousands it will cost. Nicole Fisher, whom I met in a RE mastermind, organized the loan and is also unable to contact Africa or Johnny Estrada.
It seems like if it's a scam and enough people got screwed, we could do an international manhunt, find her and hold her accountable. Or maybe that's just in the movies.
I am sorry you are going through this.
I want to verify that you are similar as the others I have communicated with in hopes to educate anyone coming upon this thread (not to rub salt in the wound - the transitive trust is big issue in the 2 deals I have some info on (d street I had a lot of info. Many of us make deals with trusted partners providing less scrutiny than we would perform without the trusted relationship).
- you trusted the other Nicole to do the vetting and did no vetting or virtually no vetting yourself.
- you used someone else’s (likely partner A’s) lending document.
- This lending contract did not contain a personal guarantee nor was backed by the property in any position (backed by property will not help in this case because first lien holder is unlikely to recover full amount owed so subsequent positions will not get anything). Personnel guarantee of GPs could be helpful but most of the GPs are losing significant money and you all (including most of the GPs) look likely to have been defrauded.Some of these GPs (and lenders) are involved in multiple of these problem investments.
Again I am sorry this happened to you. There is enough risk in these investments without fraud/theft.
Best wishes
- 2moDan H.Pro MemberInvestor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
This article states that Africa Estrada (AKA maiden name África Ela Nsuga) is a serial fraudster. It implies that there is a 2nd article forthcoming on the various fraud investments that occurred recently in Sacramento.
When I initially was consulted about the D street investment (close to a month ago), I searched and found a site that contained people in Spain that had claimed to have been swindled by Arica Estrada. When I went back to consult it, I could no longer find it. I never saw anything on the Santa Clara and Oakland investments. It shows that wiping an internet presence may be possible. It is my hope that this thread will be impossible to get wiped and that anyone searching for Africa Estrada will find this thread and the link to the associated article. If I see the subsequent article, I will post a link to it. The goal being that Africa finds it difficult to swindle others going forward.
https://diariorombe.es/investigacion/the-collapse-of-wanderl...
The read is a bit tideous, but to summarize this is at least the third time where it appears they have ran off with or grossly mismanaged investor funds. Valencia Spain, Oakland and Santa Clara CA, and Sacramento (the subject of this thread).
The two Sacramento properties that I have seen some financials (D street I saw virtually everything except I did not see the breakdown on the initial rehab quote (just was told the price) but I could tell it was grossly too low) are bad enough that they likely could only be this bad with either fraud or gross mismanagement.
I am sorry people lost a lot of money. I am sorry friendships have been strained and broken over this. I hope we are making it difficult for the same person to do it again to others.
Be careful with who you trust.
- 2moNichole KinardPro MemberMember since 2024 · 13 posts · 9 votes
Thanks for that. I had previously successful deals with Africa making it a little more befuddling. AND they recorded my deed of trust on 7/10/2026. I'm so confused as to why they would do that if they were already on the run.
I have been in touch with others who are co-investors on my deal. Not sure what we'll do, but I agree, the Estradas need to be plastered all over the internet so this doesn't happen to others.
- Flipper/Rehabber · San Francisco USA · Member since 2024 · 7 posts · 2 votes2mo
Quote from @Nichole Kinard:
Thanks for that. I had previously successful deals with Africa making it a little more befuddling. AND they recorded my deed of trust on 7/10/2026. I'm so confused as to why they would do that if they were already on the run.
I have been in touch with others who are co-investors on my deal. Not sure what we'll do, but I agree, the Estradas need to be plastered all over the internet so this doesn't happen to others.
https://diariorombe.es/investigacion/the-collapse-of-wanderl...
Apparently, she has been doing this for years,this is recent article about some of her victims and her modus operandi - 2moDan H.Pro MemberInvestor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
Quote from @Nichole Kinard:
Thanks for that. I had previously successful deals with Africa making it a little more befuddling. AND they recorded my deed of trust on 7/10/2026. I'm so confused as to why they would do that if they were already on the run.
I have been in touch with others who are co-investors on my deal. Not sure what we'll do, but I agree, the Estradas need to be plastered all over the internet so this doesn't happen to others.
If what is owed and backed by the property is greater than the current value of the property, the deed is worthless as the best financial decision is to let the first position lender foreclose on the property.
This was the case of D street. One principle in that deal wanted the deed but I question why? Some principles still believed the deal could still be saved if they had the deed, but a big issue was the initial rehab quote was not real. Some principles still had treated the underwriting numbers as close to legit. The initial rehab estimate was not close to legit. The historic designation was going to further increase the rehab. ARV was less than currently owed plus actual rehab cost (lowest rehab estimate was missing items and too low, the other 2 seemed a little high). The best financial decision is let the lender foreclose. When I was consulted, I asked if they wanted to work for free or even worse, pay to work. I indicated that was almost certainly what the result would be if they tried to save this effort.
What do you plan to do with the deed? Is ARV > owed + rehab + holding costs + selling costs? D street was not close to that criteria.
Sorry this happened to you. Per the article, Africa apparently has been pretty good at swindling investors.
Best wishes
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