Thoughts on syndications such as Gelt?

[Kalen Jordan]

I recently came across Gelt (https://www.geltinc.com/) - seems like a great option to invest in. I think this is what is referred to as a syndication but not totally sure?

Seems like they've gotten some pretty amazing returns.

I have to say that I do like the level of control of owning a SFH where you own it directly and have a degree of control over it. But I also like the simplicity of not having to deal with any of the details of management.

Is there anything that you can do to ensure that your money is safe?

Gelt seems like a really solid operation and I've been following some of the people on Twitter - they seem like great people.

I think of these examples of like Bernie Madoff who was massively trusted by people in the industry and ended up just being a scam. How do you know that's not the case for syndications? How do you know your money is safe?

[Luke Miller]

Gelt has a good reputation. However, from what I know about their business, I disagree with their investment thesis. Right now, they are purchasing in great areas (Colorado) at a premium and essentially banking on appreciation. They are securing long-term Fannie debt and expecting appreciation at the end of the loan cycle. This is not dissimilar from Grant Cardone or other more institutional syndicators. 

Instead, a better way to protect your investment is to look at operators offering cash-flow as part of their overall return. Gelt might be, but I have never seen their offerings, only heard interviews of their principles.