ur thoughts? small time investing

[Kyu Kim]

i'm a new member and i wanted to just get some feedback, your thoughts on....

if you could become part of a deal (small or big) would you go ahead and invest lets say as little as you want (no minimum) in a real estate partnership?

ex) you see the investment property and you like it, all the numbers look good it's more of a buy and hold and your source of income is from the rent and appreciation later..the fund collects partners from all over. investors are "collected" until enough $$ is collected to cover the cost of the property.

so it's a real esate partnership with no min and with numerous partners, run by a company. so a real estate investment trust in small form for small investors, who have lets say 1,000 lying around in a bank account.

Not sure if i'm clear, but would you be willing to be a part of it?

[Jon Holdman]

A better question is, why would you want to do this?

What you're proposing is a partnership. Creating such a partnership is a big task. Such partnerships are governed by both state and federal regulations, and those regulations are actively enforced. You cannot legally create a partnership and then solicit investors, regardless of the investment amount, without following the legal procedures. If you and some buddies decide to form a company, and all chip in some money, that's one thing. If you form a company and take investors money, you are "selling securities". Phrase it however you want, but that what regulators see it as.

There are ways to do this fairly painlessly. Those are "Regulation D" filiings. You find a good lawyer, do the filings, and then offer shares or units of your company. That paperwork will run you about $25,000 in legal fees. It will give you the ability to solicit from people you already know. Even then, only a limited number. Easiest if you only solicit "accredited investors". That has a very specific meaning. Someone with over $1,000,000 net worth, or an income of at least $200,000 a year or an income of at least $300,000 a year as a couple. Depending on your documents, you might be able to solicit "sophisticated investors". Those are people who you interview and determine they have sufficient knowledge and experience to invest in a risky investment. But people with only $1000 in a bank account? No way.

If you want to solicit people you don't know, you're making a "public offering". Figure a million plus for the legal work and regulatory filings. But if you do that, you're a real company, and can sell your stock to anyone.