How to legally raise funds for note buying

[Jay Raught]

I recently purchased my first note and I am looking at a couple of other notes. My question is once I run through my initial capital, how can I legally raise funds?

Where can I find JV's or information on how to reach out to them?

If anyone has used JV's can you share your experience?

I just want to make sure I do not collect any funds improperly.  

Thanks in advance for your time!!

[Bob Malecki]

Hi Ray, we recently formed a private equity fund to do such a thing. Ours is a Reg D 506(b) fund which provides for both accredited and non-accredited investors.  These are folks who understand how lucrative notes can be but don't have the time or resources to do their own note buying.  Something like this will allow you to raise millions in capital but plan on spending $15-30K for attorneys fees to get all of the required documents made. 

On the lower end of the spectrum, I'm doing JV partnerships with individuals on on-off NPL deals where they provide the funding, I do the workouts and we do a profit split on cash flow and/or capital gain. We execute a JV agreement and typically will create a Personal Property Trust to hold the asset with each of us or our entities as the beneficiaries. Unless you are planning to do multiple deals with one partner, using a PP Trust is less expensive and simpler than creating a LLC.

To find JV partners, look at your local REIA group or see if there is a Meetup group in your area. Notes are a relationship business, even when looking for partners.

Hope this helps!

Bob