Fractionalized Note Investing

[Gaylon George]

Investment Info:

Single-family residence note investment investment.

Purchase price: $365,000
Cash invested: $25,000
Sale price: $495,000

This was an investment in a fractionalized note on the above property. I was only in it for 4 months and it all went smoothly as planned.

What made you interested in investing in this type of deal?

It was a quick way to get involved in RE investing without having to do the work myself. I wanted to get my feet wet, so to speak.

How did you find this deal and how did you negotiate it?

I heard a presentation by the owners of Hornet Management at a weekly luncheon that I attend at Casa Chapala in Austin which is an Apartment Meet-Up. Non-denominational. Anyone interested in apartment investing can attend.

How did you finance this deal?

Cash

How did you add value to the deal?

I just asked a lot of questions about how the deal was structured. I would not say that I added value to the deal other than participating and bringing money to the deal.

What was the outcome?

A 12% return on my investment.

Lessons learned? Challenges?

Afterwards I discovered that not all the deals they had done were performing as planned and sought explanations and received satisfactory answers to my concerns. You can never ask too many questions and talk to others who have invested with whoever is sponsoring the deal.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Hornet Capital put the deal together and I would recommend them for this type of deal if this is your interest.