Realty Mogul Review
If you need financing for a property or you wish to invest in someone else's property, Realty Mogul is the crowdfunding website and peer to peer lending platform for you. The platform easily assists with matching up those who need loans and financing with those who have funds to invest. For the present, you still need to be an accredited investor (until the end of January 2016), but Realty Mogul helps you out with this requirement by basically asking you a series of questions and allowing you to tell them that you are accredited. You must check off on a few boxes and give an admission that you qualify as an accredited investor who makes over $200,000 per year as an individual or $300,000 as a married person and who has $1 million in net worth. In practice they do not verify to see if you really have the finances that you claim or not.
Realty Mogul Intro & Background
Realty Mogul arose in 2012, though it did not launch at www.RealtyMogul.com until 2013. Their mission then was the same as it remains: to simplify investing in real estate by connecting real estate investors and entrepreneurs via cutting-edge technology. Fast forward to four years later and you will see that Realty Mogul has transformed into a leader in the real estate capital online marketplaces. They provide both commercial debt and commercial equity products throughout the United States, educate their interested investors, and consolidate the company which they genuinely believe will alter the way that real estate is financed and invested in for all time.
This is not mere idle boasting; they can back up their expansive claims with hard statistics. Realty Mogul honestly claims 20,000 investors, sponsors, and borrowers all working together to fund the next big real estate transaction and deal. They have already financed over 300 individual properties worth more than $700 million. Presently, they have move than 75 employees at this flourishing enterprise.
The simplest way to describe Realty Mogul is by saying that it is an accredited investor marketplace where individuals can pool together money on the Internet to purchase pieces and shares of investment properties that are thoroughly pre-vetted by Realty Mogul's underwriting staff. As such, it is a true online market for investing in commercial real estate equity and debt. Borrowers and sponsors receive financing through debt and equity.
Realty Mogul is simultaneously a hybrid type of platform, acting as both social network, listing service, and educational portal. When we say educational portal, we are not just talking about a few casual articles on real estate here, we are referring to some highly valuable and worthwhile daily lessons that cover the full spectrum of various real estate categories of investment. Every lesson was crafted with the intention of equipping and teaching. In other words, these are real lessons, not just ezine articles or someone's blog postings.
Realty Mogul Founder and Management Team
CEO and Founder of Realty Mogul Jilliene Helman handles the daily operations, strategic direction, and works on the Investment Committee and the Board of Directors for Realty Mogul. She has personally overseen the underwriting of more than $5 billion worth of real estate and worked as a VP of Union Bank, where she also served in Risk Management and Finance, and Wealth Management.
Chief Technology Officer and Co-Founder of Realty Mogul Justin Hughes is also a California licensed real estate professional. Before co-founding Realty Mogul, he operated his own Los Angeles independent online community consultancy business helping to build up company presences on the Internet.
Chief Credit Officer Megan Goodfellow has worked in the institutional side of finance for three full decades. Her specialty lies in analyzing real estate capital structures and the strategies behind the financials. She served as Centerline Capital Group's Affordable Housing Special Asset Management Director prior to coming to Realty Mogul. Here she managed over 50 properties along with the troubled assets' restructuring division. Before that, she was the JP Morgan Chase CMBS Group's Chief Underwriter and Credit Officer. In this post, she managed five different regional offices and oversaw 30 underwriters who were closing balance sheet loans and underwriting conduit loans as well.
Chief Information Officer Tim Li handles data science, technology, product development, and analytics for Realty Mogul. He launched a number of lending platforms, and also had leadership positions at such outfits as LoanDepot.com, Quick Bridge Funding, JP Morgan Chase, and Think Finance. Tim simultaneously sits on a variety of advisory boards for such technology startups as Blinker Inc., Solar Mosaic, Hello Soda, and Domuso.
Realty Mogul Loans
Realty Mogul is all about keeping it simple. This is why they only offer two main types of loans to their clients. These are commercial loans and equity loans.
• Commercial Loans – they are a source for online capital for commercial real estate. If you need bridge financing, a traditional permanent commercial loan, or only shorter term private money, Realty Mogul can deliver some of the most competitive rates around town. As an example, Small Balance Private Money provides a facility of between $500,000 and $1.5 million at a term of either 12 or 24 months. For traditionally sized private money, they offer between $1 million and $5 million for terms of either 12 months and 24 months. Bridge loans provide between $1 million and $50 million of financing for a repayment term of between 1 and 3 years. Finally, Perm Loans deliver between $1 million and $50 million in financing at 5, 7, and 10 year terms of repayment.
• Equity Capital – They provide a source for financing of small balance commercial equity. Sponsors gain the advantages of one-stop shopping and managing of their distributions, K1, quarterly report, and all other relevant details. Realty Mogul delivers more than 19,000 accredited investors to help handle any sized crowdfunding needs. They can provide anywhere from $1 million to $5 million of finance with 2-10 years of repayment flexibility, though 3-7 year repayment terms are generally preferred.
How Realty Mogul Works
Once you become an investor with Realty Mogul, you are allowed to browse through the already vetted investment opportunities in real estate, go through your due diligence, enter an investment completely online, and monitor these investments utilizing their simple to employ dashboard. After becoming a prospective borrower or sponsor, you are able to request house flipping loans, permanent loans, bridge loans, and joint venture equity deals all online.
You can get stated in an investment with only $5,000. Every investment property is connected with a real estate management company which handles all of the daily hassles of tenants, toilets, and trash collection. These investments require enormous amounts of capital and good connections to make aside from a platform such as this one. If you do not wish to take a stake of partial ownership in a commercial property, you might instead choose to lend money to experienced and professional house flippers and collect interest payments on a monthly basis.
If you take on an equity stake then you actually own a small piece of a multi-unit complex or a single-family home and leave all of the purchasing, rehabilitating, renting out, and finally selling tasks to another professional. While the house is gaining appreciation value, you earn rent payment distributions. You are able to cash out finally and recover your principal with (hopefully) a nice appreciation when the flipper sells the house.
If instead you loan out money short term to a house flipper who has the experience and contacts to do the job but lacks the sufficient working capital, then you dole out funds to them for from 3 months up to a year. This way you save them from the hassle of having to deal with hard mortgage loan people who have unreasonably long underwriting procedures and high closing costs. While this loan is only backed up by their personal guarantee, you do have priority position on the lien on their house should the deal go south and they be unable to repay you. The majority of Realty Mogul's prior funded loans for house flipping come attached with an 8% interest rate per year.
Realty Mogul Services
Realty Mogul provides a great number of educational and practical services for you their investors:
- Bonus for new sign-ups – if you refer a friend, you both receive a $150 Amazon gift card for completing the registration process (i.e. no upfront investment required).
- Personalized Mogul Profile Page – to be your virtual business card on the platform.
- The Daily “Mogul Insider” e-Newsletter – providing real-time tips, tricks, & updates.
- The Learn Module – gives on-demand access to the one step at at a time real estate investing lessons you need to succeed in real estate investing now.
- The “101 Guide” to Real Estate Investing – gives you a blueprint to your next (or first) deal.
- LIVE Bi-Weekly Mentoring Calls – help you with expert advice and also answers to any of your questions.
- The Mogul Publishing Program – offers you a chance to become the expert and earn $50-$500 “quick hits” of cash.
- The Interact Module – provides access to both Realty Mogul's own team and thousands of other online active investors.
- The Deal-Making Module – delivers you all of the buyers, lenders, sellers, and partners you could ever require.
- On-Demand Deal Funding – provides instant access to hundreds of private money and hard money lenders.
- Premium Passive Cashflow Deals – allow you to rely on a steady stream of from $200-$850 per month rent checks.
- An Instant Internet Marketing Cash Flow Stream – that provides you with a “safety net” when the inevitable down months in real estate hit your business.
Realty Mogul Locations
Realty Mogul maintains only a single office. Their corporate headquarters are found on prestigious Santa Monica Boulevard in Los Angeles, California at 10780 Santa Monica Boulevard, Suite 140, Los Angeles, California 90025.
Realty Mogul Interface Screenshots
Realty Mogul Safety
Realty Mogul takes very seriously the safety of their members and their online stored information. To this effect, they employ Secure Sockets Layer SSL protection that is the gold standard for security technology in providing encrypted links between web browsers and web servers. This safeguards all information that flows back and forth between the two to keep them integral and private. This is a true industry standard that is deployed by literally millions of different websites to protect both their customers and the sanctity of their online transactions. A third party additionally audits Realty Mogul for an added layer of security in enforcing rigorous standards of compliance.
The investments themselves are very speculative. Only investors who feel comfortable with the real possibility of never seeing any of these investment dollars again should participate, as even if the investment is returned with interest or capital gains, it may be many years before investors see the invested money back again. Besides being speculative, they are also highly illiquid.
Realty Mogul Complaints and Ratings
The Better Business Bureau maintains an A+ rating on Realty Mogul based on the fact that it has no complaints which are filed with the BBB. Zero customer complaints over a three year period is impressive no matter how you slice and dice it.
Realty Mogul Customer Support
Realty Mogul aims to provide a great deal of educational support to its customers. They do this with a full blown learning module, a thorough glossary of terms, and a substantial Frequently Asked Questions section. Where support with customer service is concerned, the company does give out its phone number and email address for customer support, although they do not currently support a live chat feature on the site.
Realty Mogul Costs & Fees
Prospective borrowers pay origination fees when their loans are funded. These amounts vary widely based on the borrower's experience and the nature of the property in question. While investors do not have to pay any registration or account setup fees, you do encounter maintenance and service fees. These are mostly taken out of your percentage returns and are from the spread between the money paid to Realty Mogul and the money they pay out to you the investor. Any additional servicing fees will be spelled out clearly by the company on any investment deals or offerings that they present to you.
Final Words on Realty Mogul
Realty Mogul is a leader in the fractional ownership of investment property concept and in the hard money lending field. Their operation is unique from their various rivals because of the focus on maintaining a cash-flow through interest or rent payments throughout the life of your investment. They also outsource all of the real estate holdings to professionals who are vetted for their skills, ability, and experience. So long as you are comfortable with tying up your principle for as long as the 7-10 year repayment timeframes of their commercial real estate loans, then you should do fine with this typically far higher-paying percentage of returns type of investment.
Pros of Realty Mogul
- A simple questionnaire proves to be the only vetting that Realty Mogul does to ensure that you are really an accredited investor.
- Investors are not charged fees for investment management beyond what is taken out of the spread unless you are notified in the deal terms specifically.
- Returns on these types of commercial loans and real estate loans are comparatively very high to other forms of investments, if you can bear the years without access to your capital principal.
Cons of Realty Mogul
- Even $5,000 is a great deal of money to sink into an investment that you can not do effective due diligence on by yourself.
- Obtaining impressive returns on any single investment project is mostly about the skills of that particular house rehabilitation team and is really out of your control.
Realty Mogul Summary
Soon all investors everywhere will be able to participate in great outfits like Realty Mogul and their deal offerings to obtain higher returns on proven types of investments such as commercial real estate and house rehabilitation and flipping. This company has an impressive track record with over 300 properties funded in the last few years, removing the main objection raised about a lack of transparency and track record skeptics have levelled in the direction of the real estate peer to peer lenders and crowdfunders.