What is Capital Investing?
Real estate investing can sound intimidating for most first-timers. Most people get nervous, scared, and anxious because they don't have the knowledge or skills to get involved in flipping or developing properties. Some are horrified by the idea of becoming a landlord. But real estate investing extends beyond development, fixing, and flipping. There are many ways to invest in real estate passively, and one of the quickest ways is capital investing.
So, what exactly is capital investing?
In real estate capital investing, you essentially become a bank for property developers. You provide the money for a renovation or construction project so that an experienced developer or rehabber can complete a project. They then sell that project, return your capital investment, and you receive interest on your investment.
At Epic Impact Investors, we provide hard money lending and develop capital investors. Our two-fold mission is to help people of color understand that capital investment is a viable way to passively invest in real estate. We all have a desire to put our money to work for us and receive an interest on the capital we invest. And that is the essence of capital investing and what Epic Impact does.
The benefits of being a real estate capital investor
#1 Your investment is backed by a hard asset
Your investment is backed by the property in which you invest. There's a mortgage put on that property in the name of Epic Impact Investors so that we have a first lien position. So, if something happens with the borrower or the loan defaults, we have a recourse against that property in which our investors can get their money back. We can finish the project and sell it off, or we foreclose and sell it off. Either way, investors get their money back. When you invest in other avenues like the stock market, you don’t get your money back when a stock hits zero.
The asset backing that comes with real estate capital investing reduces your risk of loss. Reduces it, it does not eliminate it.
#2 We conduct the due diligence
It’s important to note that there is no such thing as a risk-free investment, even in real estate. But our team at Epic Impact Investors conducts the due diligence for you. When you invest through us, we vet the developer or borrower for you. We visit them, vet the property, check out the scope of work, compare the scope of work, and review profitability of the project.
We figure out how much you stand to earn from the investment after the repair of the property. This ensures that we're not over-financing the property, which is loaning more than what the market is going to bear for the return.
#3 It’s an additional income stream
According to the IRS, there are seven forms of income streams. Most millionaires got there by having three income streams. So, capital investment is a passive income stream that brings a great return. We do 9% to 11% returns depending on the type of deal. And that is what your capital investment is going to earn during that time. This means you’re putting your money to work, and that's truly how you build wealth.
#4 It diversifies your portfolio
You can’t have all your eggs in one basket. So, we always recommend that you invest in stocks, mutual funds, and real estate. And capital investing is one of the ways you can diversify your portfolio. It allows you to diversify your portfolio without the hands-on work that comes with fixing and flipping properties. It allows you to passively invest in real estate and build your wealth so you can leave an amazing legacy.
#5 You get a better return on your money
Your money will do more for you in a real estate capital investment than it will sitting in a savings account. With our 9% to 11% returns, you get favorable interest within 12 months, especially when you're getting that type of return on high investment. I have repeat investors who have increased their investment amount. That money keeps getting flipped over in new deals, earning additional interest. Now they've created a repeat passive income stream for themselves.
#6 Community benefit
When we invest in real estate, our money goes back into our communities. We are helping to develop communities of color, which have historically been under-served, overlooked, and undervalued. These communities have struggled with access to capital since the time when federal redlining was legal.
We now can provide capital to other people of color who are going to develop our communities. We help bring the equity back into the home to help other people build wealth and a legacy through real estate. There are more than just financial benefits to real estate capital investing. There is a philanthropic community benefit to this as well.
Don't miss out on becoming a capital investor through Epic Impact Investors! You can download our FREE capital investor guide here to learn more about capital investing. Also fill out your information to invest through us. If you have any questions or concerns, reach out to me through the Epic Impact Investors Facebook group.