Lincoln, NE · Member since 2014 · 57 posts · 11 votes
Good Morning BP,
Over the last year or two I have shared my RE interest with family & friends. A handful of them have reached out to me and want to be a part of it, a few want to actively invest with me (buy &hold) & a few want to diversify their other investments.
I am working on creating this business model but still in the beginning phases. So far what I know I need to do & working on.
- Create an LLC
- Finalize my business to plan to present to potential investors and outline how I believe the future business will be successful
- Set up a team. I currently have a real estate agent, lawyer, insurance agent
If anyone has any feedback or suggestions I would love to hear them!
Attorney / Multifamily Investor · Houston, TX · Member since 2009 · 173 posts · 136 votes
10y
*** This is not legal advice and I am not your lawyer. ***
My reading of the Texas Securities Act is that IF
(1) all your investors are from Texas AND
(2) you are issuing debt and not equity (i.e., borrowing money instead of selling pieces of your company)
You are exempt from both the federal and state securities laws, which means you can advertise and issue the debt to multiple lenders or even a pool fund.
So you can offer them a note secured by a mortgage in the property(ies) you buy.
Offering equity gets into the murky waters of securities registration, but if all the investors are Texans, you can offer equity to up to 35 friends and family investors (no solicitation allowed) or an unlimited number of accredited investors (solicitation allowed).
Then again, check back next week because things may have changed.
Jessica, did you get your group up and running? I'm in a similar situation and would love to hear your thoughts on how it worked out for you.
Hey Valentine,
I haven't made much progress on this situation - I need to get more serious about it this year... What have you done on your end or are you still in the beginning process?
Investor · San Antonio, TX · Member since 2015 · 11 posts · 0 votes
10y
I am still in the beginning stages as well. My wife and I own several rental properties in Texas. In the last few months, we've had several people come to us to and asked how they could partner with us by investing money. I'm trying to figure out how that would look like on our end.
I'm trying to come up with a way to pool our money together to aquire more properties but not sure about how to structure that.
Attorney / Multifamily Investor · Houston, TX · Member since 2009 · 173 posts · 136 votes
10y
*** This is not legal advice and I am not your lawyer. ***
My reading of the Texas Securities Act is that IF
(1) all your investors are from Texas AND
(2) you are issuing debt and not equity (i.e., borrowing money instead of selling pieces of your company)
You are exempt from both the federal and state securities laws, which means you can advertise and issue the debt to multiple lenders or even a pool fund.
So you can offer them a note secured by a mortgage in the property(ies) you buy.
Offering equity gets into the murky waters of securities registration, but if all the investors are Texans, you can offer equity to up to 35 friends and family investors (no solicitation allowed) or an unlimited number of accredited investors (solicitation allowed).
Then again, check back next week because things may have changed.
Investor · Sachse, TX · Member since 2015 · 223 posts · 66 votes
10y
@Jessica Monroe Ok guys. Its time to buckle down and take your future by the reins. If you have people interested and you have a plan, you need to take action. If you have been waiting 1 or 2 years, it has been long enough. I am not saying this to be mean just hoping to inspire you. You can only learn to swim by jumping in the water.