Can I invest?
The Investor's Source Private Lending Fund #1 is open to verified accredited investors only. An accredited investor is defined by the Securities and Exchange Commission as an investor who has a net worth of more than $1M (excluding primary residence) OR who has income greater than $200K per year for the past 2 years ($300K for a married couple).
What is the minimum investment for the Private Lending Fund?
$50,000
Who is the Fund Manager, and does he have any skin in the game?
The Fund Manager is an LLC managed by David Goldberg, president of The Investor's Source LLC. David is a shareholder in the Fund with significant holdings. David personally guarantees all loans in the fund used as pledged assets for Fund lines of credit. He also has personal credit lines of $2.2M available to provide liquidity as needed.
What is the Funds target return to Members?
The Fund Manager aims to provide investors with a targeted overall annual return of 8% to 12%. These returns are not guaranteed and there is no guarantee that investors will not lose principal.
Will the Fund utilize any debt when originating Fund Assets?
The Fund may choose to borrow money from time to time at no more than 8% typically, and may pledge one or more Fund assets as collateral for any such borrowing. We believe the use of debt is warranted and desirable when the assets being leveraged produce reliable and stable cash flow, and the debts cost & terms are favorable. The amount of debt may not exceed 30% of the total assets under management.
How does the Fund make money?
The Fund will receive, as income, 100% of any interest collected on commercial mortgage loans and other fund assets, 100% of any redemption fees charged and collected, 100% of any interest collected on deposited funds or receivables owned by the Fund, 100% of any prepayment fees payable pursuant to the terms of a loan, and 100% of any value received in exchange for assets sold by the Fund. The Fund will also receive as income 50% of any origination fees, 50% of any loan extension fees, and 50% of any late payment fees. From this, direct expenses are deducted, including fees to the Fund Manager and Loan Originator.
How do you know the borrower is on track with a commercial real estate project?
Before the project begins, a project schedule and the associated draw of funds is established. Funds for rehab or construction projects are held in escrow by the Fund Manager. Once work is complete and verified, funds are released to the borrower.
What if the borrower doesn't make interest payments on time?
The Fund Manager handles all communication with the borrowers. If a borrower is late, the Fund Manager will assess late fees. If there is a more serious problem, the loan terms may be modified to allow the borrower to complete the project and assure investors are paid fully. As a last resort, the Fund Manager may need to foreclose on a property or take the property back and take steps to recover the value of the asset.
What if something happens to the Fund Manager?
If the principal Manager cannot manage due to death or disability, the Fund's Operating Agreement outlines how the duties would be distributed to other senior management of the Fund or the Fund may be liquidated by vote of the shareholders. The Manager is contractually obligated to provide at least one years notice before resigning. If the Fund is discontinued, investors will receive their share of the Fund as it is liquidated.
How can I get my money back?
The Fund is structured for a minimum investment of one year. After this time, you can request to get your share of the Fund back. Return of funds is based on availability of capital as loans pay off and new money is accepted into the Fund, and will be returned as quickly as possible.
What paperwork is involved?
Once you decide to invest, you'll need to review the Private Placement Memorandum and we will verify your accredited investor status. Then you will sign a Subscription Agreement. You can find out more about the investment process if you give us a call.
Who owns the Private Lending Fund?
The Fund is owned 100% by the investors who purchase equity units in the Fund.
How long will the Fund remain open?
Our Private Lending Fund is an open-ended, evergreen fund with no set end date. The Manager expects to make and acquire Fund Assets on a frequent and ongoing basis and will continue to do so indefinitely until the maximum offering of $20M investor capital (with the option to increase), has been reached, or until the Manager believe market conditions do not justify continuing. The Manager may utilize the return of capital from the disposition of fund assets to make and acquire new fund assets or may return the capital to members.
How is the Fund formed for tax purposes?
The Fund will be treated as a partnership for federal tax purposes. Investors considering a purchase of the units should consult their own tax advisor for advice on any personal tax consequences that may be associated with investment in the Units.
What is the process for getting started?
Investing in the Private Lending Fund or Trust Deeds is very streamlined. Click Here for a step by step description of how the process works.
We specialize in investor-friendly deals that benefit both borrowers and lenders. Investing with The Investor’s Source can help you diversify your portfolio, grow your wealth, and support projects that transform Colorado, Wyoming, Florida, Washington, Massachusetts and Nebraska communities
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