I always tell potential Money Partners that ultimately, all investing has risk. It can’t be totally avoided, but it definitely can be mitigated! This principle is very important. I tell them even if they choose not to provide funding for any of my house buying deals, to always make sure that they, or whomever they are investing with, understand the potential risks now and in the future, and have plans in place to mitigate the effects of those risks.
I take heed of this principle as I buy single family houses with the capital provided by others. I tell potential Money Partners, “because of the buying system I have in place no Money Partner has ever lost money with me and you won’t be the first”.
Also I teach them that once they find a potential passive investment always educate themselves and do their own due diligence on the investment and the people behind it. Of course, I make it easy for my Money Partners because I give them an overload of information on each deal I desire funding on.
There is often confusion over what it means to be “passive”. I think some people imagine just blindly handing over their money to someone. Honestly, I don’t think you should ever be truly “passive” … just “active” in a different sense. You should be actively seeking out, evaluating, and monitoring your investment – but without dealing with the day-to-day hassles of managing. It is still much less time and effort than doing it on your own!
Of course, my Money Partners trust me but I always tell them to verify everything…then leave me alone to do the day to day dirty work of buying repairing then selling houses.
************************* If you are reading my blog for the first time, let me inform you that: I am a guy that buys single-family houses and I write this blog weekly which is primarily directed to educate 1 group of individuals:
Individuals who are losing their shirt as a result of the “roller coaster” volatility of the stock market and low paying rate of other traditional investments…People that are looking for an opportunity that’ll provide a secured place to put their money to get it working for them to earn better than average returns.
However, often times, homeowners that need to sell their house, stop by to take a peek because they are curious and wondering how and/or where I get the funding to purchase houses. And if they stick around long enough, they begin to understand why individuals partner with me to provide the funding which empowers me to be able to purchase real estate on a continual basis.
Request your FREE Education Kit if you are interested in learning how passively investing in real estate may help place you in a better financial position.[spacer height=”20px”]
Disclaimer: This site is intended for educational purposes only. I am not an accountant, attorney or licensed financial planner. While the information I’m writing here is based on many years of experience buying houses that doesn’t really constitute professional advice (since everyone’s experiences and situations are different).