Circle of Capital: Building Black Communities (Part 1)
Recently I had a discussion with a group of real estate investors from other states and a topic that came up was how we, as people of color, can build wealth in our communities but avoid gentrification of those same communities. I feel this is not only an interesting and enlightening topic to consider but I feel it directly relates to investing in a hard money lender like Epic Impact Investors. This will be a 2-part series.
People of color need capital to continue to build our communities. We need to be able to access capital and there is a long and storied history regarding that access. A story that is still going on today with modern-day redlining. There are still lenders who won’t lend in particular zip codes (mainly ones of communities of color) and banks that strip equity from our homes with ridiculously low appraisals.
Here at Epic Impact Investors we strongly believe that communities can build their own capital, increase wealth-building right in their own backyard. This circle of wealth starts with money from people of color, black people with money, investing in their communities. Their investments help others to reach their financial goals which feeds wealth into the community. The investor gets their investment back plus income from the interest. The investor can now reinvest their capital starting the cycle again.
It all starts with the investor. That is why I work so hard to educate people of color so they can learn how to become capital investors. Many other racial groups have been doing this for generations, they have generational wealth in both money and knowledge. It is vitally important that more people of color have this knowledge of how to build wealth. We need to learn this to build our own personal wealth, to build up our communities, and to have these skills to pass to our children.
Epic Impact Investors is looking for investors ready to start investing in hard money lending. We want you to become part of this circle. We need our investors to have at least $50,000 to start. Fifty thousand dollars isn’t usually enough to fund an entire house renovation but we want to keep the barrier of entry low. Wealth building has to start somewhere and we want more people to have access to beginning in passive real estate investing.
Next, we have a hard money lender, Epic Impact Investors. Once we have funding from the capital investor(s) we begin the vetting process. We look at the property, the viability of the project, and the people and prepare all the paperwork to protect the investor’s capital. Since we service our own loans as well, we are also in constant communication with the borrower. We build a relationship with the borrower, keep abreast of the project, and track the timeline. We are a resource for the borrower if they run into a hurdle or have difficulty finishing the project.
Our end goal is always to have a successful project for everyone involved. Three things need to happen for us to deem the project a success. The investor needs to get their capital investment back plus their interest. Next, we’ve built a relationship with the borrower that can lead to repeat business. Finally, the home is sold to a person of color which builds black wealth and adds value to the community. That is how we define success here at Epic Impact Investors.
The money now flows along the circle from Epic to the borrower, the flipper or the real estate developer. With their project funded, the borrower puts money into their business. Not only do they support their own family but they hire contractors. The contractors hire employees, people of color, who now are building wealth in earning wages to pay their bills.
Contractors are often teachers as well. They teach their employees valuable skills. Maybe they have an apprentice or a family member they are bringing on the job, somebody who can learn to manage a project of their own. Contractors have knowledge they can pass on to the community, enabling others to financially sustain themselves.
Once the rehabilitation is completed and the home gets sold the cycle moves forward again. Hopefully, it was a person of color who bought this home in this vibrant community of color. This new homeowner is now able to start their own wealth building journey by building equity. Homeowners give back to their community in many other ways as well. They raise their children in the community, they contribute to the viability and sustainability of their community.
Money naturally flows into the community throughout this process as well. Money is going to businesses and stores in the community. Money is going into the school system for more resources. It’s not all just financial gains either, there is also human capital. Viability capital invested into the community meaning people showing up to community events, people being involved with the economic and political process.
Finally, now that the home has been sold, the investor gets their money back. They get their principle plus their interest back as well. Hopefully, this begins the cycle again to continue to build that community. This is the mission, the vision, for us at Epic Impact Investors.
We want to be a resource for our communities. At the end of the day, we want viable communities of color. We want sustainable wealth building. All this can happen through our Circle of Capital. People of color need to know that this method of passive real estate investing is a viable way to build wealth and to get diversity in their investment portfolio.
We hope that you will join us as an investor. Sign up for a free telephone consultation to let us know what your goals are for investing, ask us any questions you might still have. Even if you aren’t ready to invest just yet, we can discuss additional steps you can take to get there financially. If you are ready to participate as an investor, if you are ready to make an impact in communities of color, please reach out so we can get you matched to a project.
Are you a real estate developer or have a property you want to flip here in the Chicago area? We want to hear from you as well! Fill out our online application. We’ll analyze your deal and send you an email walking you through the next steps.