I work for MassVenture.com, a Texas real estate crowdfunding platform, and I can add a little bit of input based on our work and research.I think crowdfunding is a new financial tool, but is unlikely to be a "technology revolution" as it can sometimes be discussed or be left out of.Fundamentally, we see crowdfunding as a new instrument.

Guess you could ask why folks turn the radio on instead of learning to read music and play an instrument.

I loaned $20k to a guy last year I'd never met and didn't bother to record the deed I got because someone I trust said I could trust him (and said he'd pay me back if that guy didn't)  Reputation goes a long way in this biz when you've been at it a while.Anyway, things vary from state to state on doing it, but its essentially just two documents, a note outlining the terms of the loan and a security instrument (security deed, deed of trust) that encumbers the property with the note so you cant sell it without paying them. 

@Jay Hinrichs from your perspective, what recourse does an investor in a fractionalized instrument have should the project go sideways?

Fannie Mae (FNMA) and Freddie Mac (FHLMC) are institutional investors who purchases mortgages from originating lenders, and bundle them into instruments called Mortgage-Backed Securities which are sold on the open market to various parties (Mutual Funds, Pension Funds, and even regular investors like you and me who might want to allocate a certain portion of our IRA or 401(k) money toward fixed-income investments).

Russo is fully capable of making an informed decision.My perspective is more of a bird's eye view of where the market is headed, why the spate of CRMs, and why so many reg D funds are acting as intermediaries, selling their holdings to Wall Street, who then collateralize the underlying asset, mostly into debt instruments for re-sale at brokerage houses.

Commercial security instruments and notes also have a varying degree of features that are different than residential.

Your articles, especially those about financially analyzing deals, were instrumental in helping me get to this point.A bit about me: My name is Joseph.

What you are describing is more accurately described as "instrumental value" or "final value".

I’m trying to get a good understanding of the use of these instruments so don’t be afraid to post your comments, positive or negative, you won’t hurt my feelings.Thanks for all your help; I look forward for your responses.