It's also very tricky to verify rehab expenses, and subject to fakery, etc.The loan still works great if the rehab is light to moderate, and you can end up with a considerable amount of leverage in the property (probably as much as you want or need, frankly).

Have to verify rents are actual and not with free rent given to move in etc. which lowers the monthly averaged rent rate.

I have verified extensively through the MLS.

The county verified this to the HOA.

In fact, it actually requires that the person raising the capital to be much more responsible (and hence more liable) in their due diligence on making sure the investor truly is accredited.There are also requirements of:1) Notification to the SEC15 days before use of the exemption2) Another filing within 30 days of completion to the SEC3) Additionally, disclosures will include expanded information on the issuer and the offered securities, the types of investors in the offering, the use of proceeds, the types of general solicitation employed, and the methods used to verify the accredited status of investors.

Then you are in for verifying accredited status and maybe audited books.Saving you some reading: some states like NC, GA (??)

If I determine on the phone that they can't produce the tax records I'm just going to tell them I have to pass.A person with a "normal" job could get fired too.Either this applicant has verifiable income through tax records that can meet your income requirements or they don't.

If you do rent make sure to have you or your handyman walk through the home monthly to verify repairs and conditions.

Definitely verify those too before moving forward.As an example, if the ARV was $500k, then $500k X .7= $350k - $100k rehab = $250k max offer based on this figures.

Ronald Reagan's quote "Trust but verify" comes to mind.