Private Lender, Secured Debt:  “The Retirement Solution”

This program allows our investors who value stable, secure returns that come in the form of a check either on a one-time or regular basis. The return percentage is fixed, and money is sent directly into the investor’s IRA or bank account.

The investment will either be secured with a position on a residential (1 to 4 unit) property (if the amount is sufficient), or sit idle (earning interest) until it can be secured. A promissory note is signed for a certain term, at which time the principal and any unpaid, accrued interest is paid back to the investor. Returns offered range from extremely low risk to moderate risk.  The investor has the option of either collecting checks on a quarterly basis, or be paid annually, or let everything accrue until the investment term ends (typically, the longer until repayment, the higher the interest).

Minimum Investment:  Our lowest available. Please contact us for more details.

Interest Rate:  Dependent on term & repayment

Repayment Options:  Quarterly, Semi-Annually, Annually, & At Maturity

Secured Lender Program

Role:

Plays role of “the banker” Our secured lenders only have to do one thing – cash their stable, scheduled checks as they come in (if they invest through their IRA custodian, they don’t even have to do that!).

Be a Secured Lender if you:

Value security, and a stable monthly payment, secured by a piece of real property.

Real Estate Background Needed:

You do not need to know anything about real estate, nor ever want to, to participate in this program.

Risk Level, Worst Case Scenario:

Every deal is different, with different levels of risk. Lender’s risk is limited in whole by the property on which they lend.

The only risk to a secured lender is if we, AA Real Estate, for any reason can no longer afford the monthly payment. This has never happened to this point, nor have we ever come close. The recourse in this case, if we fail to make the scheduled payments, our lender can foreclose and seize the property, and resell it to get their investment back.

In other words, the investor becomes a mortgage holder on the property in order to make it a secure investment.  What this means in a worst case scenario, is that if AARE should default on the payments, the investor has the right to take the property, and use the sale of it to offset their principal investment. If this were to ever happen, due to our strict buying guidelines, usually the investor would actually MAKE a substantial amount on the sale, as we only purchase properties at a large discount, in order for us to profit on the deal. This is obviously a worst case scenario, but we hope, as an investor, you realize how safe this creates your interest in the property. We have never defaulted, and do not plan on it in the future.

Here’s an interesting note: with the way we purchase these properties, the lender would in theory be making an immediate profit (up to 100%) on their investment in this case, based on our current market targeting and acquisition strategy. Does this sound even better than just getting a 7% monthly payment?

Returns:

Their returns are not as significant as equity partners, because the level of risk is lower. Even still, we are currently averaging higher returns than the market.*  Returns depend completely on the payout options and structure of the deal.  Every deal is different.

You receive a set interest rate, for a set amount of time, while using their funds to either acquire or rehab a property.

The investment will be paid back at the end, plus they’ll receive interest on the investment. Returns come in the form of a check on a regular (or one-time) basis.

Or, instead of regular payments, to just pay them one large check back at the end of the term in return for a small difference in the rate. In order to make it a secure investment, the investor eventually becomes a mortgage holder on a property.  What this means in a worst case scenario, is that if AARE should default on the payments, the investor has the right to take the property, and use the sale of it to offset their principal investment.  If this were to ever happen, due to our strict buying guidelines, usually the investor would actually MAKE a substantial amount on the sale, as we only purchase properties at a large discount, in order for us to profit on the deal.  This is obviously a worst case scenario, but we hope, as an investor, you realize how safe this creates your interest in the property.  We have never defaulted, and do not plan on it in the future.

This form of lending has a set minimum investment.  The interest rate depends on hold time and repayment options.

To see what deals we have available that may fit your goals, please fill out our Qualification Form and fax it back to our office at 781-435-0789.

* Another disclosure:  Past performance does not have any reflection or indication of future performance, as it is solely dependent on market conditions, the stability of the asset, and the factors surrounding each deal.