SEC Proposes Anti-Fraud Rules to More Closely Regulate Hedge Funds & Certain Venture Capital Funds
Robert Masud asked:
Recently, the SEC proposed changes that would affect the investment in hedge funds as well as other pooled investments. On December 27,2006, Release No. 33-8766 (the “Release”) proposed an anti-fraud rule that would be new under the Investment Advisers Act of 1940 (the “Advisers Act”). This new rule revised criteria for admission for individuals that invest in some private funds (excluding some venture capital funds). The Release says that these rules are meant to cover two of the SEC’s particular areas of interest.
Accredited Investor
The Release suggested new standards for individuals that may invest in certain funds privately offered as an enhanced definition of “accredited investor.” These funds are exempt from the Investment Company Act of 1940, as amended (the “1940 Act”) by provisions of Section 3(c)(1). New standards would require “accredited investors” to fulfill the previous standards plus not own investments totalling less than US$2.5 million as a qualified purchaser under the Section 3(c)(1) exemptions. Under Regulation D of the Securities Act of 1933, as amended, require a net worth of over $1 million (individual or joint net worth with spouse), or have an income over $200K each year over the past two years (or joint income with a spouse of over $300K in each of those two years plus an expectation to stay at the income level for the current year).
Anti-fraud Regulations
Section 206(4) of the Advisers Act has a new proposed anti-fraud rule that would prohibit investment advisers from making statements to investors in pooled investments it manages that would be misleading or false, regardless of whether the investment is registered or unregistered (including hedge funds). The management company also many not participate in fraudulent, manipulative, or other deceptive behavior.
The rule would allow the investors to be viewed through the fund, and reverses one of the effects of the U.S. Court of Appeals decision in Phillip Goldstein, et al, v. SEC. In this case, the SEC’s 2004 requirement for hedge fund advisers to count investors in that particular fund to determine if registration is neceaary was overturned. The new rule is meant to assure that the anit-fraud provisions apply to future and prospective investors and not just to the current pool.
The Release also stated that the new rule was made intentionally broad to outline “the making of materially false or misleading statements as a fraudulent, deceptive or manipulative practice, and to prohibit other practices that defraud or deceive pool investors, rather than designed to prohibit a specific practice.” It would regulate practices and statements made to current and prospective investment clients, and would provide for, among other things, representations made in account statements and memoranda.
Investment advisers to pooled investment vehicles as well as advisers that are not required to be registered under the Advisers Act, are covered in this new rule as well. The SEC stated in the Release that “it is critical that we continue to be in a position to bring actions against unregistered advisers that manage pools and that defraud investors in those pools.”
Commercial Loans to 65% of Value
Recently, the SEC proposed changes that would affect the investment in hedge funds as well as other pooled investments. On December 27,2006, Release No. 33-8766 (the “Release”) proposed an anti-fraud rule that would be new under the Investment Advisers Act of 1940 (the “Advisers Act”). This new rule revised criteria for admission for individuals that invest in some private funds (excluding some venture capital funds). The Release says that these rules are meant to cover two of the SEC’s particular areas of interest.
Accredited Investor
The Release suggested new standards for individuals that may invest in certain funds privately offered as an enhanced definition of “accredited investor.” These funds are exempt from the Investment Company Act of 1940, as amended (the “1940 Act”) by provisions of Section 3(c)(1). New standards would require “accredited investors” to fulfill the previous standards plus not own investments totalling less than US$2.5 million as a qualified purchaser under the Section 3(c)(1) exemptions. Under Regulation D of the Securities Act of 1933, as amended, require a net worth of over $1 million (individual or joint net worth with spouse), or have an income over $200K each year over the past two years (or joint income with a spouse of over $300K in each of those two years plus an expectation to stay at the income level for the current year).
Anti-fraud Regulations
Section 206(4) of the Advisers Act has a new proposed anti-fraud rule that would prohibit investment advisers from making statements to investors in pooled investments it manages that would be misleading or false, regardless of whether the investment is registered or unregistered (including hedge funds). The management company also many not participate in fraudulent, manipulative, or other deceptive behavior.
The rule would allow the investors to be viewed through the fund, and reverses one of the effects of the U.S. Court of Appeals decision in Phillip Goldstein, et al, v. SEC. In this case, the SEC’s 2004 requirement for hedge fund advisers to count investors in that particular fund to determine if registration is neceaary was overturned. The new rule is meant to assure that the anit-fraud provisions apply to future and prospective investors and not just to the current pool.
The Release also stated that the new rule was made intentionally broad to outline “the making of materially false or misleading statements as a fraudulent, deceptive or manipulative practice, and to prohibit other practices that defraud or deceive pool investors, rather than designed to prohibit a specific practice.” It would regulate practices and statements made to current and prospective investment clients, and would provide for, among other things, representations made in account statements and memoranda.
Investment advisers to pooled investment vehicles as well as advisers that are not required to be registered under the Advisers Act, are covered in this new rule as well. The SEC stated in the Release that “it is critical that we continue to be in a position to bring actions against unregistered advisers that manage pools and that defraud investors in those pools.”
Commercial Loans to 65% of Value
Car Wash at Brightway in Marshfield on Sunday, May 18th Will Raise Funds for a Life-saving Defibrillator for the Boys & Girls Club
Steve Dubin asked:
For every vehicle washed, Brightway is donating $5 which will be put towards the purchase of a defibrillator for the non-profit Boys and Girls Club of Marshfield.
During the fundraiser, the South Shore Corvette Club will have 25 Corvettes on display and there will be plenty of hot dogs, popcorn and balloons for the kids.
Everyone having their car washed will be entered into a raffle to win Red Sox tickets, auto detailing and a book of car washes.
“We like working with non-profits. We’re pleased to be able to help out the Boys and Girls Club with our professional car wash service that is better for the environment than the old-fashioned hose-style car washes,” noted Paul Vercallone of Verc Rentals and Brightway Car Wash.
Brightway Car Wash is environmentally friendly and renowned for its “Green Theme”. According to Vercallone, Brightway is “very stingy with water” as they do not want to waste water and Brightway disposes of waste water properly.
“We’re very grateful to Paul Vercallone, Brightway and the South Shore Corvette Club for their involvement and effort in raising the necessary funds so we can have a defibrillator on-site in case of an emergency,” noted Greg Jackson, Executive Director of the Boys and Girls Club of Marshfield.
The 1,000 member strong Boys and Girls Club of Marshfield provides the area’s youth between the ages of 6-18 with enrichment and recreation programs in a safe environment.
To learn more about Boys and Girls Club of Marshfield, visit their website at www.MarshfieldBoysAndGirlsClub.com.
About the Boys and Girls Club
The Boys and Girls Club of Marshfield’s purpose is to establish a safe haven for recreation, which includes a variety of supervised activities for greater than 4,000 youths (between the ages of 6 to 18 years old) within the town. The Boys and Girls Club of Marshfield has five Core Areas: Character and Leadership; Education and Career; Health, Sport Fitness Recreation and Life Skills; The Arts; and Technology. These Core Areas serve as the foundation for all programming.
As a privately-funded, non-profit organization, the Boys and Girls Club of Marshfield relies tremendously on the generous philanthropic support of individuals. Financial gifts assist in providing the financial strength necessary to continue the club’s mission “to enable and inspire all young people to realize their full potential as productive and responsible citizens, as well as become tomorrow’s capable leaders.”
For more information about the Boys and Girls Club of Marshfield, please contact (781) 834-CLUB (2582) or visit the website at www.MarshfieldBoysAndGirlsClub.com or write to the club at P.O. Box 311, Marshfield, MA 02050.
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For every vehicle washed, Brightway is donating $5 which will be put towards the purchase of a defibrillator for the non-profit Boys and Girls Club of Marshfield.
During the fundraiser, the South Shore Corvette Club will have 25 Corvettes on display and there will be plenty of hot dogs, popcorn and balloons for the kids.
Everyone having their car washed will be entered into a raffle to win Red Sox tickets, auto detailing and a book of car washes.
“We like working with non-profits. We’re pleased to be able to help out the Boys and Girls Club with our professional car wash service that is better for the environment than the old-fashioned hose-style car washes,” noted Paul Vercallone of Verc Rentals and Brightway Car Wash.
Brightway Car Wash is environmentally friendly and renowned for its “Green Theme”. According to Vercallone, Brightway is “very stingy with water” as they do not want to waste water and Brightway disposes of waste water properly.
“We’re very grateful to Paul Vercallone, Brightway and the South Shore Corvette Club for their involvement and effort in raising the necessary funds so we can have a defibrillator on-site in case of an emergency,” noted Greg Jackson, Executive Director of the Boys and Girls Club of Marshfield.
The 1,000 member strong Boys and Girls Club of Marshfield provides the area’s youth between the ages of 6-18 with enrichment and recreation programs in a safe environment.
To learn more about Boys and Girls Club of Marshfield, visit their website at www.MarshfieldBoysAndGirlsClub.com.
About the Boys and Girls Club
The Boys and Girls Club of Marshfield’s purpose is to establish a safe haven for recreation, which includes a variety of supervised activities for greater than 4,000 youths (between the ages of 6 to 18 years old) within the town. The Boys and Girls Club of Marshfield has five Core Areas: Character and Leadership; Education and Career; Health, Sport Fitness Recreation and Life Skills; The Arts; and Technology. These Core Areas serve as the foundation for all programming.
As a privately-funded, non-profit organization, the Boys and Girls Club of Marshfield relies tremendously on the generous philanthropic support of individuals. Financial gifts assist in providing the financial strength necessary to continue the club’s mission “to enable and inspire all young people to realize their full potential as productive and responsible citizens, as well as become tomorrow’s capable leaders.”
For more information about the Boys and Girls Club of Marshfield, please contact (781) 834-CLUB (2582) or visit the website at www.MarshfieldBoysAndGirlsClub.com or write to the club at P.O. Box 311, Marshfield, MA 02050.
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Nextstudent Offers Private Student Loans, Available Year-round
Jeff Mictabor asked:
Due to recent increases in college tuition, the rising costs of textbooks and other general expenses, accurately planning how much money is needed for the school year can prove to be a challenge. The second semester or term is usually the time of year when many college students and their parents review the remaining funds available for the current school year.
According to NextStudent, the Phoenix-based premier education funding company, oftentimes, if expenses are greater than original projections borrowers can meet the shortfall with a private student loan.
Qualifying For Private Student Loans Is Simple
Whether a student needs more funds right away, wants money for summer school, or if the student is involved in a distance learning program or enrolled in a private or state institution, NextStudent can help.
Since there is no application deadline as with federal student loans, no fees are involved, the funds are unsecured, and many times may not require a co-signer, there are many benefits of retaining a private student loan from NextStudent. Another advantage is that students receive their student loan directly. This allows borrowers to retain control of their money and avoid the long wait times often associated with channeling the funds through the institution.
To be eligible for private student loans, borrowers may be either an undergraduate or graduate student enrolled at least half-time in a TERI-approved program, pursuing a degree or certificate-based coursework. Students may borrow the cost of their annual attendance or up to $40,000, whichever is less.
It is easy for borrowers to apply for NextStudent private student loans, either online at www.nextstudent.com or by calling 877.690.9879. Approvals can be generated in as few as 15 minutes with a personally-assigned Education Finance Advisor.
Generous Repayment Terms For Private Student Loans
Students are not required to start repaying their private student loans unless they become enrolled less than half-time or until six months after graduation. Borrowers can start paying with as little as $25, have many repayment options, up to 20 years to repay and may qualify for tax-deductible interest payments. Those with accumulated total student loan balances that exceed $40,000 may opt to extend the repayment term to 25 years.
In order to optimize their college educational experience, many students are taking advantage of NextStudent’s private student loans. These funds often stand in the gap, enabling borrowers to achieve their dreams of a higher education and cover where federal student loans leave off.
NextStudent believes that getting an education is the best investment you can make, and it is dedicated to helping you pursue your education dreams by making college funding as easy as possible. Learn more about Student loans at NextStudent.com.
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Due to recent increases in college tuition, the rising costs of textbooks and other general expenses, accurately planning how much money is needed for the school year can prove to be a challenge. The second semester or term is usually the time of year when many college students and their parents review the remaining funds available for the current school year.
According to NextStudent, the Phoenix-based premier education funding company, oftentimes, if expenses are greater than original projections borrowers can meet the shortfall with a private student loan.
Qualifying For Private Student Loans Is Simple
Whether a student needs more funds right away, wants money for summer school, or if the student is involved in a distance learning program or enrolled in a private or state institution, NextStudent can help.
Since there is no application deadline as with federal student loans, no fees are involved, the funds are unsecured, and many times may not require a co-signer, there are many benefits of retaining a private student loan from NextStudent. Another advantage is that students receive their student loan directly. This allows borrowers to retain control of their money and avoid the long wait times often associated with channeling the funds through the institution.
To be eligible for private student loans, borrowers may be either an undergraduate or graduate student enrolled at least half-time in a TERI-approved program, pursuing a degree or certificate-based coursework. Students may borrow the cost of their annual attendance or up to $40,000, whichever is less.
It is easy for borrowers to apply for NextStudent private student loans, either online at www.nextstudent.com or by calling 877.690.9879. Approvals can be generated in as few as 15 minutes with a personally-assigned Education Finance Advisor.
Generous Repayment Terms For Private Student Loans
Students are not required to start repaying their private student loans unless they become enrolled less than half-time or until six months after graduation. Borrowers can start paying with as little as $25, have many repayment options, up to 20 years to repay and may qualify for tax-deductible interest payments. Those with accumulated total student loan balances that exceed $40,000 may opt to extend the repayment term to 25 years.
In order to optimize their college educational experience, many students are taking advantage of NextStudent’s private student loans. These funds often stand in the gap, enabling borrowers to achieve their dreams of a higher education and cover where federal student loans leave off.
NextStudent believes that getting an education is the best investment you can make, and it is dedicated to helping you pursue your education dreams by making college funding as easy as possible. Learn more about Student loans at NextStudent.com.
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What is Meant by a "private Offering" or "private Placement?" Offering to Sell Interest in My Fund. Accredited Investors
Turn Key Hedge Funds asked:
http://www.turnkeyhedgefunds.com
What is meant by a "Private Offering" or "Private Placement?"
The whole point of the private offering is to avoid burdensome registration and prospectus delivery requirements of the Federal Securities Laws. A "private offering" is exempted from such compliance. Regulation D provides the "safe harbor" provisions which, if complied with, will have the effect of exempting the private offering from compliance with the registration and prospectus delivery requirements of the Federal Securities Laws. It does not exempt the offering and persons associated therewith from compliance with the fraud provisions of the Federal Securities Laws or compliance with the various State Securities Laws. However, pursuant to recent federal legislation, states are prohibited from imposing their blue sky regulation on securities offered pursuant to Rule 506 of Regulation D except for the filing of the Form D or a substantially similar form and the payment of filing fees.
How do I offer to sell interest in my fund ?
Rule 502(C) of Regulation D prohibits any form of a general solicitation or general advertising. Generally the interests in your hedge fund may sold by Registered Broker Dealers or officers of the management (general partner) to those persons with whom there has been a prior relationship.
Is the hedge fund restricted to selling only to "accredited investors" and what is an "accredited investor"?
Rule 501 of Regulation D provides the definition "accredited investor" and provides that any person who comes within the following enumerated categories, or who the issuer reasonably believes to come within those categories, at the time of the sale of securities is an "accredited investor." Those categories include, banks or savings and loans association whether acting individually or as a fiduciary; any broker or dealer ; any insurance company, investment company registered under the Investment Company Act; employee benefits plan if the investment decision is made by a plan fiduciary as defined by such Act, which is either a bank, savings and loan association, insurance company, or registered advisor, or if the employee benefit plan has total assets in excess of $5 million or is a self-directed plan, with investment decisions made solely by persons who are accredited investors; any private business development company as defined by the Investment Advisors Act of 1940; any organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, not formed for the specific purpose not formed for the specific purpose of acquiring securities offered, with total assets in excess of $5 million; any director, executive officer, or general partner of the issuer of the securities being offered or sold or any director, executive officer, or general partner of a general partner of that issue; any natural person whose individual net worth or joint net worth with that person’s spouse at the time of his purchase exceeds $1 million; any natural person who had an individual income in excess of $200,000 for each of the two most recent years or joint income with that person’s spouse in excess of $300,000 for each of those years and has a reasonable expectation of reaching the same income level in the current year; any trust with total assets in excess of $5 million not formed for the specific purpose of acquiring securities offered, whose purchase is directed by a sophisticated person as described in Section 230.506(b)(2)(ii); and, any entity in which all of the equity owners are accredited investors. Under Regulation D, a hedge fund can accept up to 35 non-accredited investors. However, Rule 502(B) requires that hedge funds offered to non-accredited investors have certain adequate financial statements.
http://www.turnkeyhedgefunds.com
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http://www.turnkeyhedgefunds.com
What is meant by a "Private Offering" or "Private Placement?"
The whole point of the private offering is to avoid burdensome registration and prospectus delivery requirements of the Federal Securities Laws. A "private offering" is exempted from such compliance. Regulation D provides the "safe harbor" provisions which, if complied with, will have the effect of exempting the private offering from compliance with the registration and prospectus delivery requirements of the Federal Securities Laws. It does not exempt the offering and persons associated therewith from compliance with the fraud provisions of the Federal Securities Laws or compliance with the various State Securities Laws. However, pursuant to recent federal legislation, states are prohibited from imposing their blue sky regulation on securities offered pursuant to Rule 506 of Regulation D except for the filing of the Form D or a substantially similar form and the payment of filing fees.
How do I offer to sell interest in my fund ?
Rule 502(C) of Regulation D prohibits any form of a general solicitation or general advertising. Generally the interests in your hedge fund may sold by Registered Broker Dealers or officers of the management (general partner) to those persons with whom there has been a prior relationship.
Is the hedge fund restricted to selling only to "accredited investors" and what is an "accredited investor"?
Rule 501 of Regulation D provides the definition "accredited investor" and provides that any person who comes within the following enumerated categories, or who the issuer reasonably believes to come within those categories, at the time of the sale of securities is an "accredited investor." Those categories include, banks or savings and loans association whether acting individually or as a fiduciary; any broker or dealer ; any insurance company, investment company registered under the Investment Company Act; employee benefits plan if the investment decision is made by a plan fiduciary as defined by such Act, which is either a bank, savings and loan association, insurance company, or registered advisor, or if the employee benefit plan has total assets in excess of $5 million or is a self-directed plan, with investment decisions made solely by persons who are accredited investors; any private business development company as defined by the Investment Advisors Act of 1940; any organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, not formed for the specific purpose not formed for the specific purpose of acquiring securities offered, with total assets in excess of $5 million; any director, executive officer, or general partner of the issuer of the securities being offered or sold or any director, executive officer, or general partner of a general partner of that issue; any natural person whose individual net worth or joint net worth with that person’s spouse at the time of his purchase exceeds $1 million; any natural person who had an individual income in excess of $200,000 for each of the two most recent years or joint income with that person’s spouse in excess of $300,000 for each of those years and has a reasonable expectation of reaching the same income level in the current year; any trust with total assets in excess of $5 million not formed for the specific purpose of acquiring securities offered, whose purchase is directed by a sophisticated person as described in Section 230.506(b)(2)(ii); and, any entity in which all of the equity owners are accredited investors. Under Regulation D, a hedge fund can accept up to 35 non-accredited investors. However, Rule 502(B) requires that hedge funds offered to non-accredited investors have certain adequate financial statements.
http://www.turnkeyhedgefunds.com
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U.s. Gov’t, Architects of Hedge Funds Cause Collapse of America’s Real Estate Economy
Robert Hand asked:
U.S. Gov’t, Architects of Hedge Funds Cause Collapse of America’s Real Estate Economy
By: Robert W. Hand
Designated Broker/Owner
Equity Alliance Properties
www.equityallianceproperties.com
Subprime Crisis? Heavens no, this is a complete collapse of the national real estate business sector of the U.S. economy, with the mortgage companies and the federal government right at the heart of the matter. The effects of the national real estate business enterprise breakdown with the subprime debacle well underway can be felt throughout every economic sector, including Wall Street.
Of course, there are still those on Wall Street profiteering on the broken back of the real estate business economy. These investors originated, and still draw huge amounts of interest on “interest only” loans, and are the beneficiaries of the federal government’s deliberately slow actions to remedy this fundamentally simple matter.
For most Americans, the most significant form of wealth we have is in the equity in our homes. Americans are losing their real estate endowments, and the effect of a broken real estate business sector has brought the general economy to its knees. The masses are feeling it while the rich get richer. That’s right, the guys still making money off of these high interest loan products make the headlines saying, “Just let time fix it”. You didn’t think they were out of the game did you? Who do you think these “interest only” loan payments continue to be paid to? The longer this thing takes to get fixed, the longer they will continue to draw huge dividends on their “interest only” loan products that by design were never intended to be paid back as no money ever goes toward principal. Strong lobby money representing those interests is slowing down the process in Washington where debts take time to repay, with a nod and a wink.
I released an article last month (http://paradisevalleyblog.com/2007/11/crisis-or-opportunity-truth-about.html)portraying the number of incidences of loans in default as a small fraction of the number of loans overall, a number which is steadily climbing. Nevertheless, keeping those numbers in perspective, that still leaves, by some estimates, 1.1 million Americans losing their residential properties over the next 6 years.
Yes, this is a simple matter and it can be fixed with cash money, go figure. Let’s put the numbers of dollars to fix this problem into perspective in a fashion to which we’ve all grown accustomed; comparing it to the money we spend on the occupation of Iraq. To continue our
military occupation in Iraq the U.S. Taxpayers pay: $270 million every day; $8.4 billion per month; a total of $600 billion spent and approved War-spending; another $200 billion requested for 2008 which would bring the cumulative total to $800 billion. There have been $10 billion mismanaged and wasted in Iraq per Feb 2007 hearings. There have been $1.4 billion Halliburton overcharges classified by the Pentagon as “unreasonable and unsupported”. 20 billion was paid to former Halliburton division, KBR for food, fuel, housing, and other items. Pentagon auditors deem that $3.2 billion of that is “questionable and unsupportable”. Some figures predict the cost of the Iraq war topping out at
over $2 trillion.
Just a small fraction of the capital Halliburton defrauded U.S. taxpayers out of alone would fix our mortgage crisis, would mend the broken real estate business sector of our economy, and would have a positive effect on the overall economy that would far exceed any amount of money we put back into fixing the system. So how much money are we talking about? Congressional Democrats led by Charles Schumer (D-NY) advocate spending just hundreds of millions (less than 1 billion) of dollars into nonprofits to help homeowners and the overall economy. A spokesman for the senator explains he
is not suggesting the government pay off borrower’s loans in full, but believes a mixture of counseling and restructuring of the loans would bring down the costs of the program dramatically. Even if we paid all the loans in full it would be a pittance in contrast to the overall federal budget, let alone the Iraq war budget (if you can call Washington’s fiscal policies budgeting). Further, we can spread the cash outlay to fix the problem over a period of 6
years, according to the rate schedules of the remaining loans in question.
Such a partial bailout is estimated to cost no more than a few hundred million dollars. Compare that to the $8.4 billion we spend every month bringing “Democracy” to Iraq with combat airplanes, helicopters, missiles, tanks, and troops. Even if we bail out everyone with a bad loan, what are we talking about in U.S. dollars…a month or two of what we spend rebuilding the Iraq we so surgically blew up? The top runners of the presidential race spill that much in a single weekend at their white tablecloth fundraisers! Appropriation of a relatively small amount of funds would pull our economy out of the tailspin we currently find ourselves in! But who’s suffering…lower middle
class, not the rich. The Bush Whitehouse neoconservatives were just this week exposed in lies and manipulation of intelligence data regarding Iran as a nuclear threat. This exposure shamelessly still has not thwarted Bush’s rhetoric to invade Iran and threats of World War III as he continues to terrorize citizens abroad and here in America. We had better just save our hard earned tax dollars to fight another war on terror in Iran and forget allocating any funds
to fix the U.S. economy which is, after all, only hurting the peasants. The war profiteers belong to the class of the super rich. George Bush should be impeached while he and his closest advisors, including Dick Cheney, should all be formally brought up on charges of international war crimes.
We have seen any number of articles written voicing the opinion, “Why should we pay our tax dollars to bail out some idiot that was just too stupid to know what he was signing,” or invoking such profound truths as, “It’s just a bunch of greedy investors anyway, they knew what they were
doing.” Perhaps those are fair characterizations in some instances, but who pays? We all do. Worse yet, this type of reaction is exactly what the profiteers of this debacle want to continue to hear, so the process remains
stalled by the indecision and lack of common platform by constituents. Profiteers continue to earn big returns on the money already loaned that is not yet in default. This has all been calculated to a “T” and has been executed as planned. Everyone at the top, the architects of the hedge funds, knew this was not designed to last! These were all interest only loans,
which by design, were never intended to be paid back, as nothing is paid to principal.
Most folks who have fallen prey were not stupid at all, but were just trying to secure their family’s future in real estate holdings. Mortgage brokers promised consumers that they could re-finance out of their nasty little adjustable rate 2nds or HELOCs in 6 months to 2 years depending on the loan program, pre-payment penalties, etc. No layperson could predict the market falling so far so fast. Refinancing out of these undesirable loan conditions quickly became a lost option as so many homes declined in value to far less than originally loaned on them. This has caught far too many people off guard, including seasoned investors and real estate
brokers, to write this off as some folks being careless or stupid. It is a more sophisticated problem than that. There are folks that not only predicted this, but calculated exactly what has transpired and are the beneficiaries thus: the major interests in and architects of the hedge funds that back these securities and continue to prosper from grotesque interest rates on “interest only” loans. Understand that they don’t want legislation passed that keeps them
from being able to charge insane amounts of interest as these “interest only” loans mature and reset.
You, the average homeowner pay the price, as do innocent individuals and families just trying to honestly buy their own ‘piece of the rock’. We are ALL losing equity in our homes, (whether you have a mortgage or not), at an alarming rate as property values across the nation continue to decline due to the huge surplus of homes for sale. Some markets are declining much faster than others and we’re talking about significant amounts of depreciation from every homeowner in some metropolitan areas in Arizona, Nevada, California, and Florida, to name a few. As more and more loans go into default, more and more properties go on the market in the form of short sales and foreclosures at well under market value. Increasing numbers of properties hit the market, putting ever more pressure on existing inventories, and dragging prices down further. We are getting to where we have so many short sales and foreclosures on the market that “under market” is the new norm. Our conventional methods for determining current market value and sales price now take into the effective average the
rising numbers of homes with prices slashed. Buyers, seeing the declining market values don’t want to catch a falling knife. Folks who want to buy are waiting until they see evidence of the “bottom” of the market. They won’t perceive any indication of the “bottom” as meaningful unless they see property values hold steady then raise again. This will not happen as long as more defaults, resulting in short sales and foreclosures, continue to flood the
market day after day, week after week, and month after month. Consumers keep asking, as do REALTORs®, “when are we going to see the bottom of this market?” The answer is so simple even a cave man can do it; WHEN WE STOP THE CYCLE!!!
Why then, if it is such a simple fix, are we not already on our way to enjoying the recovery as a result of taking these simple steps. The answer: Greed, and the power of lobbying money on capital hill have the process locked up and bogged down in red tape. Interest is earned over time, and with interest rates already in place for those making money from these “interest only” loans, they want more time to keep lining their pockets. This expresses one of the most frequently used relations in Algebra: Principal x Rate x Time = Interest Earned. Time is on their side; the super rich who invested in the hedge funds that back the mortgage securities we know as subprime loans. They are getting the time they want because this Republican Whitehouse favors big business, big money, and big campaign lobbyist
contributors, well represented in this group. Government is dragging their feet in spending the money to fix the problem at the pleasure of these predators.
So, folks, protect your equity, protect your interest in your own real estate holdings, protect your children’s chances of profitable
real estate holdings in America, and contact the congresspersons and senators whom preside over your districts. Give a positive voice to the budget to fix this problem. It will pay back huge dividends to our economy as a whole as we recover and stop the downward fall of the equity in our own homes.
This type of government subsidized economic recovery would not be without precedent. Consider the Savings and Loan crisis of the 1980’s, where the government bailed out S&L’s to the tune of 150 billion 1980’s dollars. We can fix our subprime crisis today for a fraction of that amount.
Currently on the hill, there is proposed legislation to impose new limits on the adjustable rate mortgages scheduled to reset.
Congress has been, and is trying to pass legislation to put a freeze on interest rates. These are band-aids for a bullet wound. Let your voice be heard. Put some pressure on politicians to get this subprime debacle resolved with swift and certain action! It is a simple matter, and the beneficiaries of this thing dragging out are the very entities who caused it in the first place. Together let’s end it, now!
Do you want to play hardball? All right, then let’s consider that the federal government does not want the average American to gain dramatically in personal wealth. Why would that be? Glad you asked. Since the years of Reaganomics and theories of a “trickle down” economy, (always reminds me of being pissed on), and deregulation, our country has moved ever more from the worlds’ shining example of Democracy to a text book example of a Republic aristocracy with the Center of Power no longer held by the masses, the common man. The Power Center is now with the elite, the upper class, the super rich, the multi-billion dollar corporate entities, the Texas based oil brokerage firms that ultimately determine tax code, foreign policy, federal budget allocations, and the decision to go to war, with whom and when, and whom have the power and influence to throw elections.
It does not serve the rich constituents of this elitist government entity strangling America to allow its citizens to amass wealth. No, my friends, that would pull too much of the Power back towards the center. Think Washington doesn’t give any thought to that dynamic? Of course they do. Washington is so paranoid of the power of its citizens that they are breaking constitutional laws or re-writing the constitution as they see fit to ensure “CONTROL”, threatening our basic civil liberties in the process. That’s right, even firefighters, (who can regularly in the course of their duties gain access into people’s homes without a search warrant), are now being trained to look for any signs that a citizen might not agree somehow with government policies and might thus be considered a threat to the government or even a terrorist. What a lot of bullocks. I’m a veteran of the U.S. Navy, whose job was gathering and disseminating intelligence, and have stood for protecting and honoring our nation. Now, it’s obvious I don’t agree with government policies. They would now view me as a threat! Sounds more like a Republic regime than a
Democracy. Sounds a lot like World War II Germany doesn’t it? Well, that’s America today, as we know it. Are you more comfortable with your head in the sand? That’s ok, go back to sleep, this article is about over. Germany went from a Nation of knowing to a nation of believing. Are we following in their footsteps as foolhardy, good-willed, ignorant patriots? Too often, we blindly
believe the lies told by the President and his government instead of challenging others and ourselves with the truth. I remember as a child learning of the atrocities in Germany under Hitler and asking, “How could all those people let this happen?” and “how could all those people have been fooled by their government?” In the words of Bob Dylan; “Patriotism is the last refuge to which a scoundrel clings; steal a little and they throw you in jail; steal a lot and they make you king.” This country has been preying on the good will of its unsuspecting citizens and it will be our undoing if we don’t wake up.
Many Americans were making big money during the real estate boom, in large part due to the ease with which funds were available to acquire primary and investment real estate. So many of us bought in to it, and for most, it has only benefited the lending institutions. Once the real estate investment game became profitable for the common citizen, it would self-destruct right before our eyes. The timing was calculated, planned, and the program executed by millions of exuberant homeowners and first-time real estate investors, not suspecting the falling axe. But those in the know, the architects of the hedge funds, knew exactly what would transpire. They didn’t bet their billions on a hunch! Oh no, they calculated every phase of the process and watched it deliver dividends.
Let me offer this challenge to other Real Estate Brokerage firms, Mortgage Brokerage Firms, Banks, and Title Companies: Equity Alliance Properties will pledge $1,000,000 of every $4,000,000 it brings in net revenue towards any program signed into law organizing such private funding. Let’s take back control of the real estate business sector for
the greater good of the American homeowner!
Get Business Loans Now
U.S. Gov’t, Architects of Hedge Funds Cause Collapse of America’s Real Estate Economy
By: Robert W. Hand
Designated Broker/Owner
Equity Alliance Properties
www.equityallianceproperties.com
Subprime Crisis? Heavens no, this is a complete collapse of the national real estate business sector of the U.S. economy, with the mortgage companies and the federal government right at the heart of the matter. The effects of the national real estate business enterprise breakdown with the subprime debacle well underway can be felt throughout every economic sector, including Wall Street.
Of course, there are still those on Wall Street profiteering on the broken back of the real estate business economy. These investors originated, and still draw huge amounts of interest on “interest only” loans, and are the beneficiaries of the federal government’s deliberately slow actions to remedy this fundamentally simple matter.
For most Americans, the most significant form of wealth we have is in the equity in our homes. Americans are losing their real estate endowments, and the effect of a broken real estate business sector has brought the general economy to its knees. The masses are feeling it while the rich get richer. That’s right, the guys still making money off of these high interest loan products make the headlines saying, “Just let time fix it”. You didn’t think they were out of the game did you? Who do you think these “interest only” loan payments continue to be paid to? The longer this thing takes to get fixed, the longer they will continue to draw huge dividends on their “interest only” loan products that by design were never intended to be paid back as no money ever goes toward principal. Strong lobby money representing those interests is slowing down the process in Washington where debts take time to repay, with a nod and a wink.
I released an article last month (http://paradisevalleyblog.com/2007/11/crisis-or-opportunity-truth-about.html)portraying the number of incidences of loans in default as a small fraction of the number of loans overall, a number which is steadily climbing. Nevertheless, keeping those numbers in perspective, that still leaves, by some estimates, 1.1 million Americans losing their residential properties over the next 6 years.
Yes, this is a simple matter and it can be fixed with cash money, go figure. Let’s put the numbers of dollars to fix this problem into perspective in a fashion to which we’ve all grown accustomed; comparing it to the money we spend on the occupation of Iraq. To continue our
military occupation in Iraq the U.S. Taxpayers pay: $270 million every day; $8.4 billion per month; a total of $600 billion spent and approved War-spending; another $200 billion requested for 2008 which would bring the cumulative total to $800 billion. There have been $10 billion mismanaged and wasted in Iraq per Feb 2007 hearings. There have been $1.4 billion Halliburton overcharges classified by the Pentagon as “unreasonable and unsupported”. 20 billion was paid to former Halliburton division, KBR for food, fuel, housing, and other items. Pentagon auditors deem that $3.2 billion of that is “questionable and unsupportable”. Some figures predict the cost of the Iraq war topping out at
over $2 trillion.
Just a small fraction of the capital Halliburton defrauded U.S. taxpayers out of alone would fix our mortgage crisis, would mend the broken real estate business sector of our economy, and would have a positive effect on the overall economy that would far exceed any amount of money we put back into fixing the system. So how much money are we talking about? Congressional Democrats led by Charles Schumer (D-NY) advocate spending just hundreds of millions (less than 1 billion) of dollars into nonprofits to help homeowners and the overall economy. A spokesman for the senator explains he
is not suggesting the government pay off borrower’s loans in full, but believes a mixture of counseling and restructuring of the loans would bring down the costs of the program dramatically. Even if we paid all the loans in full it would be a pittance in contrast to the overall federal budget, let alone the Iraq war budget (if you can call Washington’s fiscal policies budgeting). Further, we can spread the cash outlay to fix the problem over a period of 6
years, according to the rate schedules of the remaining loans in question.
Such a partial bailout is estimated to cost no more than a few hundred million dollars. Compare that to the $8.4 billion we spend every month bringing “Democracy” to Iraq with combat airplanes, helicopters, missiles, tanks, and troops. Even if we bail out everyone with a bad loan, what are we talking about in U.S. dollars…a month or two of what we spend rebuilding the Iraq we so surgically blew up? The top runners of the presidential race spill that much in a single weekend at their white tablecloth fundraisers! Appropriation of a relatively small amount of funds would pull our economy out of the tailspin we currently find ourselves in! But who’s suffering…lower middle
class, not the rich. The Bush Whitehouse neoconservatives were just this week exposed in lies and manipulation of intelligence data regarding Iran as a nuclear threat. This exposure shamelessly still has not thwarted Bush’s rhetoric to invade Iran and threats of World War III as he continues to terrorize citizens abroad and here in America. We had better just save our hard earned tax dollars to fight another war on terror in Iran and forget allocating any funds
to fix the U.S. economy which is, after all, only hurting the peasants. The war profiteers belong to the class of the super rich. George Bush should be impeached while he and his closest advisors, including Dick Cheney, should all be formally brought up on charges of international war crimes.
We have seen any number of articles written voicing the opinion, “Why should we pay our tax dollars to bail out some idiot that was just too stupid to know what he was signing,” or invoking such profound truths as, “It’s just a bunch of greedy investors anyway, they knew what they were
doing.” Perhaps those are fair characterizations in some instances, but who pays? We all do. Worse yet, this type of reaction is exactly what the profiteers of this debacle want to continue to hear, so the process remains
stalled by the indecision and lack of common platform by constituents. Profiteers continue to earn big returns on the money already loaned that is not yet in default. This has all been calculated to a “T” and has been executed as planned. Everyone at the top, the architects of the hedge funds, knew this was not designed to last! These were all interest only loans,
which by design, were never intended to be paid back, as nothing is paid to principal.
Most folks who have fallen prey were not stupid at all, but were just trying to secure their family’s future in real estate holdings. Mortgage brokers promised consumers that they could re-finance out of their nasty little adjustable rate 2nds or HELOCs in 6 months to 2 years depending on the loan program, pre-payment penalties, etc. No layperson could predict the market falling so far so fast. Refinancing out of these undesirable loan conditions quickly became a lost option as so many homes declined in value to far less than originally loaned on them. This has caught far too many people off guard, including seasoned investors and real estate
brokers, to write this off as some folks being careless or stupid. It is a more sophisticated problem than that. There are folks that not only predicted this, but calculated exactly what has transpired and are the beneficiaries thus: the major interests in and architects of the hedge funds that back these securities and continue to prosper from grotesque interest rates on “interest only” loans. Understand that they don’t want legislation passed that keeps them
from being able to charge insane amounts of interest as these “interest only” loans mature and reset.
You, the average homeowner pay the price, as do innocent individuals and families just trying to honestly buy their own ‘piece of the rock’. We are ALL losing equity in our homes, (whether you have a mortgage or not), at an alarming rate as property values across the nation continue to decline due to the huge surplus of homes for sale. Some markets are declining much faster than others and we’re talking about significant amounts of depreciation from every homeowner in some metropolitan areas in Arizona, Nevada, California, and Florida, to name a few. As more and more loans go into default, more and more properties go on the market in the form of short sales and foreclosures at well under market value. Increasing numbers of properties hit the market, putting ever more pressure on existing inventories, and dragging prices down further. We are getting to where we have so many short sales and foreclosures on the market that “under market” is the new norm. Our conventional methods for determining current market value and sales price now take into the effective average the
rising numbers of homes with prices slashed. Buyers, seeing the declining market values don’t want to catch a falling knife. Folks who want to buy are waiting until they see evidence of the “bottom” of the market. They won’t perceive any indication of the “bottom” as meaningful unless they see property values hold steady then raise again. This will not happen as long as more defaults, resulting in short sales and foreclosures, continue to flood the
market day after day, week after week, and month after month. Consumers keep asking, as do REALTORs®, “when are we going to see the bottom of this market?” The answer is so simple even a cave man can do it; WHEN WE STOP THE CYCLE!!!
Why then, if it is such a simple fix, are we not already on our way to enjoying the recovery as a result of taking these simple steps. The answer: Greed, and the power of lobbying money on capital hill have the process locked up and bogged down in red tape. Interest is earned over time, and with interest rates already in place for those making money from these “interest only” loans, they want more time to keep lining their pockets. This expresses one of the most frequently used relations in Algebra: Principal x Rate x Time = Interest Earned. Time is on their side; the super rich who invested in the hedge funds that back the mortgage securities we know as subprime loans. They are getting the time they want because this Republican Whitehouse favors big business, big money, and big campaign lobbyist
contributors, well represented in this group. Government is dragging their feet in spending the money to fix the problem at the pleasure of these predators.
So, folks, protect your equity, protect your interest in your own real estate holdings, protect your children’s chances of profitable
real estate holdings in America, and contact the congresspersons and senators whom preside over your districts. Give a positive voice to the budget to fix this problem. It will pay back huge dividends to our economy as a whole as we recover and stop the downward fall of the equity in our own homes.
This type of government subsidized economic recovery would not be without precedent. Consider the Savings and Loan crisis of the 1980’s, where the government bailed out S&L’s to the tune of 150 billion 1980’s dollars. We can fix our subprime crisis today for a fraction of that amount.
Currently on the hill, there is proposed legislation to impose new limits on the adjustable rate mortgages scheduled to reset.
Congress has been, and is trying to pass legislation to put a freeze on interest rates. These are band-aids for a bullet wound. Let your voice be heard. Put some pressure on politicians to get this subprime debacle resolved with swift and certain action! It is a simple matter, and the beneficiaries of this thing dragging out are the very entities who caused it in the first place. Together let’s end it, now!
Do you want to play hardball? All right, then let’s consider that the federal government does not want the average American to gain dramatically in personal wealth. Why would that be? Glad you asked. Since the years of Reaganomics and theories of a “trickle down” economy, (always reminds me of being pissed on), and deregulation, our country has moved ever more from the worlds’ shining example of Democracy to a text book example of a Republic aristocracy with the Center of Power no longer held by the masses, the common man. The Power Center is now with the elite, the upper class, the super rich, the multi-billion dollar corporate entities, the Texas based oil brokerage firms that ultimately determine tax code, foreign policy, federal budget allocations, and the decision to go to war, with whom and when, and whom have the power and influence to throw elections.
It does not serve the rich constituents of this elitist government entity strangling America to allow its citizens to amass wealth. No, my friends, that would pull too much of the Power back towards the center. Think Washington doesn’t give any thought to that dynamic? Of course they do. Washington is so paranoid of the power of its citizens that they are breaking constitutional laws or re-writing the constitution as they see fit to ensure “CONTROL”, threatening our basic civil liberties in the process. That’s right, even firefighters, (who can regularly in the course of their duties gain access into people’s homes without a search warrant), are now being trained to look for any signs that a citizen might not agree somehow with government policies and might thus be considered a threat to the government or even a terrorist. What a lot of bullocks. I’m a veteran of the U.S. Navy, whose job was gathering and disseminating intelligence, and have stood for protecting and honoring our nation. Now, it’s obvious I don’t agree with government policies. They would now view me as a threat! Sounds more like a Republic regime than a
Democracy. Sounds a lot like World War II Germany doesn’t it? Well, that’s America today, as we know it. Are you more comfortable with your head in the sand? That’s ok, go back to sleep, this article is about over. Germany went from a Nation of knowing to a nation of believing. Are we following in their footsteps as foolhardy, good-willed, ignorant patriots? Too often, we blindly
believe the lies told by the President and his government instead of challenging others and ourselves with the truth. I remember as a child learning of the atrocities in Germany under Hitler and asking, “How could all those people let this happen?” and “how could all those people have been fooled by their government?” In the words of Bob Dylan; “Patriotism is the last refuge to which a scoundrel clings; steal a little and they throw you in jail; steal a lot and they make you king.” This country has been preying on the good will of its unsuspecting citizens and it will be our undoing if we don’t wake up.
Many Americans were making big money during the real estate boom, in large part due to the ease with which funds were available to acquire primary and investment real estate. So many of us bought in to it, and for most, it has only benefited the lending institutions. Once the real estate investment game became profitable for the common citizen, it would self-destruct right before our eyes. The timing was calculated, planned, and the program executed by millions of exuberant homeowners and first-time real estate investors, not suspecting the falling axe. But those in the know, the architects of the hedge funds, knew exactly what would transpire. They didn’t bet their billions on a hunch! Oh no, they calculated every phase of the process and watched it deliver dividends.
Let me offer this challenge to other Real Estate Brokerage firms, Mortgage Brokerage Firms, Banks, and Title Companies: Equity Alliance Properties will pledge $1,000,000 of every $4,000,000 it brings in net revenue towards any program signed into law organizing such private funding. Let’s take back control of the real estate business sector for
the greater good of the American homeowner!
Get Business Loans Now
Private Funds – Understanding How To Use Private Funding For Investment
Julian Lee asked:
Private funds and finding people who are able to provide private funding can have a dramatic impact upon your ability to succeed at building lasting wealth. Many people find that without some assistance, taking the first step towards long term financial security can be difficult. Achieving your investment goals can be a complicated process and traditional lenders may shy away from individuals who have a poor or little credit rating. Many individuals find that securing the necessary funds to make a solid start to building can made easier when they approach private individuals for funding.
What are Private Funds
Private funds are those financial resources that are made available through the private sector or private individuals. For those who are interested in building a business, seeking venture capital or investing in real estate, there are a number of private funding opportunities available. Using private funds provides you with the advantage of lower costs, but more importantly, private funds are generally more flexible than other loans.
With daily living expenses, mortgages, credit cards, car loans and other loans eating into your income, using private funds can be one means of securing the money you need to start getting ahead financially. If you use the private funding to begin building long term wealth, and you manage to create a solid profit margin through real estate investment, then private funds can really help you start to get ahead. Private funds will let you stay in control of your finances and provide opportunities for achieving your goals when you may not be able to receive the loan through a regular financial institution.
Securing private funds from private individuals generally means that you borrow the money from these lenders who in turn want a return on their investment. Borrowing in this way is a lot more flexible than borrowing from lending institutions. This gives you the advantage of tailoring a loan to fit your unique investment goals and lending requirements.
Securing Private Funding
Getting private funding for your investment goals could be easier than you imagine. You might find that you can secure funds through a family member, business associate or friend. One way to secure the funds is through simply letting people know that you are interested in borrowing the money. If someone is familiar with the process it will be easier. If you need to look further afield to find the money you need, you might still find that this is simpler than you had thought.
One option for securing private funding is to seek out lenders through networking via investment clubs, real estate clubs and via contacts you make in these places. Many investors who are seeking private funding will recommend that you ‘prospect’ for investors willing to put up the cash for your planned investment. By regularly networking and building your contact base, you’ll find that you have a wider circle of people you can approach when seeking private funds. Once you have a solid group of contacts, you’ll also find this can help you learn of new opportunities for real estate investment and you’ll have a group of lenders who genuinely understand the investments you are making.
Another opportunity for finding potential lenders to provide private funding is via internet ads. These can help you gain more information about how to secure private funds, as well as a wealth of additional information through educational opportunities and reports. It’s not advisable to advertise for prospective lenders online yourself. Instead, it is recommended that you attend networking events or investment workshops and similar to meet others who have an understanding of private funding and an interest in lending funds for profitable opportunities. The general rate of interest on private funds is fairly consistent with personal loans, sitting at about 9-15%. This makes the use of private funds a mutually beneficial activity for both the investor and the lender.
If you are seeking an opportunity to begin investing, then private funding for real estate investment is a chance to get started on the road to financial security and long term wealth. By using private funds, you can access the money necessary to carry out investment deals for mutual benefit. In securing funds where you may not have been able to if you had to go through traditional channels, you’ll achieve your goals for real estate investment faster.
Get Business Loans Now
Private funds and finding people who are able to provide private funding can have a dramatic impact upon your ability to succeed at building lasting wealth. Many people find that without some assistance, taking the first step towards long term financial security can be difficult. Achieving your investment goals can be a complicated process and traditional lenders may shy away from individuals who have a poor or little credit rating. Many individuals find that securing the necessary funds to make a solid start to building can made easier when they approach private individuals for funding.
What are Private Funds
Private funds are those financial resources that are made available through the private sector or private individuals. For those who are interested in building a business, seeking venture capital or investing in real estate, there are a number of private funding opportunities available. Using private funds provides you with the advantage of lower costs, but more importantly, private funds are generally more flexible than other loans.
With daily living expenses, mortgages, credit cards, car loans and other loans eating into your income, using private funds can be one means of securing the money you need to start getting ahead financially. If you use the private funding to begin building long term wealth, and you manage to create a solid profit margin through real estate investment, then private funds can really help you start to get ahead. Private funds will let you stay in control of your finances and provide opportunities for achieving your goals when you may not be able to receive the loan through a regular financial institution.
Securing private funds from private individuals generally means that you borrow the money from these lenders who in turn want a return on their investment. Borrowing in this way is a lot more flexible than borrowing from lending institutions. This gives you the advantage of tailoring a loan to fit your unique investment goals and lending requirements.
Securing Private Funding
Getting private funding for your investment goals could be easier than you imagine. You might find that you can secure funds through a family member, business associate or friend. One way to secure the funds is through simply letting people know that you are interested in borrowing the money. If someone is familiar with the process it will be easier. If you need to look further afield to find the money you need, you might still find that this is simpler than you had thought.
One option for securing private funding is to seek out lenders through networking via investment clubs, real estate clubs and via contacts you make in these places. Many investors who are seeking private funding will recommend that you ‘prospect’ for investors willing to put up the cash for your planned investment. By regularly networking and building your contact base, you’ll find that you have a wider circle of people you can approach when seeking private funds. Once you have a solid group of contacts, you’ll also find this can help you learn of new opportunities for real estate investment and you’ll have a group of lenders who genuinely understand the investments you are making.
Another opportunity for finding potential lenders to provide private funding is via internet ads. These can help you gain more information about how to secure private funds, as well as a wealth of additional information through educational opportunities and reports. It’s not advisable to advertise for prospective lenders online yourself. Instead, it is recommended that you attend networking events or investment workshops and similar to meet others who have an understanding of private funding and an interest in lending funds for profitable opportunities. The general rate of interest on private funds is fairly consistent with personal loans, sitting at about 9-15%. This makes the use of private funds a mutually beneficial activity for both the investor and the lender.
If you are seeking an opportunity to begin investing, then private funding for real estate investment is a chance to get started on the road to financial security and long term wealth. By using private funds, you can access the money necessary to carry out investment deals for mutual benefit. In securing funds where you may not have been able to if you had to go through traditional channels, you’ll achieve your goals for real estate investment faster.
Get Business Loans Now
Virginia Schools Hail Successes and Fund Challenges
Patricia Hawke asked:
Virginia Schools recently received national acclaim for some of its successful schools. Newsweek released its list of the top 5% of schools in the nation, and 87 Virginia Schools made the cut. Eleven Virginia Schools made the top 100, and an additional two were included in the list of the “public elites.” Those two were Maggie Walker Governor’s School for Government and International Studies and Thomas Jefferson High School for Science and Technology. Both were included because of the higher than average SAT and ACT scores of their students.
Virginia Schools achieve these results while spending about $7,751 annually per pupil. This puts the state right in the middle for national spending. Clearly some good results are coming from some of the efforts of Virginia Schools. But there are still some big concerns and certain gaps. Like the rest of the country, Virginia Schools struggle with an achievement gap for minority students. African-American and other minority students consistently score lower as a group on standardized tests. Socioeconomic factors have proven to dramatically effect a student’s academic success.
One way that the Virginia Schools are trying to remedy this problem is through a partnership with the ECMC Foundation. In 2003 the ECMC and the Virginia Department of Education teamed up to create the Virginia ECMC Scholars Program to “increase participation in postsecondary education by economically or otherwise disadvantaged students, and to challenge these students to better prepare during the junior and senior years of high school.”
2007 will be the fifth cycle of funding and the ECMC has upped its pledge for Virginia Schools to $3 million dollars in scholarships, mentoring stipends and program funding. Participants in the programs are selected from Virginia Schools at the end of their sophomore year. What makes this scholarship program different is that educators select students they know. Anonymous strangers who base the decision on faceless essays or a qualifications list choose participants in most other scholarship programs.
ECMC and Virginia Schools select children based on future potential rather than past grades. The participants are mentored and tutored through their junior and senior years to bring out their best potential. Ten Virginia Schools were selected on basis of need, and the program is funded through 2009.
Privately funded programs like the Virginia ECMC Scholars Program are one way that Virginia Schools hope to close the achievement gap and propel the state school system forward. Virginia had its own testing system in place (Virginia Standards of Learning) prior to the 2001 No Child Left Behind Initiative. But the national mandate implemented class size and Adequate Yearly Progress (AYP) markers for every school in the nation. Pressure for students to meet passing marks in both Virginia Schools and across the nation has been intense. Educators and politicians continue to debate the merits and pitfalls of standardized testing as a way to raise learning standards in the nation.
Get Business Loans Now
Virginia Schools recently received national acclaim for some of its successful schools. Newsweek released its list of the top 5% of schools in the nation, and 87 Virginia Schools made the cut. Eleven Virginia Schools made the top 100, and an additional two were included in the list of the “public elites.” Those two were Maggie Walker Governor’s School for Government and International Studies and Thomas Jefferson High School for Science and Technology. Both were included because of the higher than average SAT and ACT scores of their students.
Virginia Schools achieve these results while spending about $7,751 annually per pupil. This puts the state right in the middle for national spending. Clearly some good results are coming from some of the efforts of Virginia Schools. But there are still some big concerns and certain gaps. Like the rest of the country, Virginia Schools struggle with an achievement gap for minority students. African-American and other minority students consistently score lower as a group on standardized tests. Socioeconomic factors have proven to dramatically effect a student’s academic success.
One way that the Virginia Schools are trying to remedy this problem is through a partnership with the ECMC Foundation. In 2003 the ECMC and the Virginia Department of Education teamed up to create the Virginia ECMC Scholars Program to “increase participation in postsecondary education by economically or otherwise disadvantaged students, and to challenge these students to better prepare during the junior and senior years of high school.”
2007 will be the fifth cycle of funding and the ECMC has upped its pledge for Virginia Schools to $3 million dollars in scholarships, mentoring stipends and program funding. Participants in the programs are selected from Virginia Schools at the end of their sophomore year. What makes this scholarship program different is that educators select students they know. Anonymous strangers who base the decision on faceless essays or a qualifications list choose participants in most other scholarship programs.
ECMC and Virginia Schools select children based on future potential rather than past grades. The participants are mentored and tutored through their junior and senior years to bring out their best potential. Ten Virginia Schools were selected on basis of need, and the program is funded through 2009.
Privately funded programs like the Virginia ECMC Scholars Program are one way that Virginia Schools hope to close the achievement gap and propel the state school system forward. Virginia had its own testing system in place (Virginia Standards of Learning) prior to the 2001 No Child Left Behind Initiative. But the national mandate implemented class size and Adequate Yearly Progress (AYP) markers for every school in the nation. Pressure for students to meet passing marks in both Virginia Schools and across the nation has been intense. Educators and politicians continue to debate the merits and pitfalls of standardized testing as a way to raise learning standards in the nation.
Get Business Loans Now
Real Estate Investors – “7 Step Formula” To Secure Private Money
Michel Lautensack asked:
- Determine how much money you need to acquire a certain property and be sure to include the purchase price, closing cost and complete renovation costs. If you do not know the renovation cost be sure to make your best estimate so you do not leave these out.
Commercial Loans to 65% of Value
- Determine how much money you need to acquire a certain property and be sure to include the purchase price, closing cost and complete renovation costs. If you do not know the renovation cost be sure to make your best estimate so you do not leave these out.
Second – Start to market for private lenders. Make a point to tell everyone you know and meet “that you investing in discounted real estate investments and are looking for investors.” Show your potential private lenders how to start investing passively in investment real estate. You can also use other marketing strategies such as sending out post cards to wealthy people or putting up flyers in 55+ communities.
Third – You will need to create a presentation kit to educate your potential private lenders to the power and security of investing in discounted real estate. Essentially, position them as “the Bank.” Deliver your presentation to your contacts within your sphere of influence and your warm market, such as business associates, friends, family, realtors, accountants and attorneys to name a few. Some of these people may know other contacts within their own networks interested in investing.
Fourth – You will find that many potential private lenders have CD’s or money market funds that are only yielding 3% to 5%. Your presentation has to show that you can offer your investors anywhere from 9% to 15% return on their money versus the small returns they are currently getting at the bank. If they stocks or bonds they may be even more willing to invest in something as safe as good solid local investment real estate versus losing 50% or more in their stock portfolios. You need to offer them more income with a secure investment.
Fifth – Once you have a potential lender or two that has expressed some interest you need to present your proposed deal. You will need to show them what it will cost to purchase and rehab the property and what it will be worth once compete. You may want to borrow all of the money to purchase the property. Or you may go to a bank and borrow 80% and then use your private lender to fund the remaining funds.
Sixth – Make sure your private lender sends the funds (i.e., certified check or wire transfer) to your closing attorney or title clerk. Never have the funds made out to you or your company. Create a promissory note for your private lender explaining the terms of the transaction and make sure they are in either first or second lien position on the property.
Seventh – Complete the purchase of the property and rehab and be sure to invite your private lender out a couple times to see the progress so they remain comfortable the investment and build a long term relationship.
Commercial Loans to 65% of Value
Private Student Loan
maki asked:
Private Student Loans – Dispelling The Myths
If savings, grants, scholarships, and federal loans don’t cover the cost of your education, it’s time to turn to private loans. But young college students can’t qualify for a private loan, can they? Wrong! This article addresses this and other myths about student loans that you may run into.
I don’t have any collateral, so I can’t get a private loan.
Private loans are usually unsecured, which means no collateral is required. On the downside, this may also mean a higher interest rate.
I don’t have a good credit history (or no credit history at all)
Since the government doesn’t back private loans, your credit history is a consideration in being approved for a loan. If your credit history is bad or non-existent, you may be subject to a higher interest rate. And remember, you can always get a co-signer. Pay your loan off on time, and soon you will have a good credit history!
I have enough funds for tuition and fees, so I can’t get a private loan
In addition to paying tuition and fees, funds from private loans can be used to cover living expenses, supplies, computers, and other everyday living needs.
I can’t afford to make payments on a loan while I am still in school
For most loans, your principal and interest payments can be deferred while you are enrolled in school. Another option is to make interest payments while you are in school but defer paying off the principal. Your interest payments might even be tax-deductible!
I missed the deadline for applying for financial aid this year
You can apply for private student loans any time – there is no deadline. Depending on the financial institution you choose, you can be pre-approved in minutes and have the money (which will be sent directly to you) within a matter of days.
I don’t have a bank to apply through
Private loans are offered by thousands of banks, credit unions, and other financial institutions. Just search the internet for “private student loans” and you will find many places to apply to.
If you need the additional funds provided by private loans, don’t let myths and misconceptions keep you from applying!
This article is distributed by Next Student. At Next Student, we believe that getting an education is the best investment you can make, and we’re dedicated to helping you pursue your education dreams by making college funding as easy as possible. We invite you to learn more about Private Student Loans .
My goal is to help every student succeed – education is one of hte most important things a person can have, so I have made it my personal mission to help every student pay for their education. Aside from that, I am just a pretty average girl from SD.
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Private Student Loans – Dispelling The Myths
If savings, grants, scholarships, and federal loans don’t cover the cost of your education, it’s time to turn to private loans. But young college students can’t qualify for a private loan, can they? Wrong! This article addresses this and other myths about student loans that you may run into.
I don’t have any collateral, so I can’t get a private loan.
Private loans are usually unsecured, which means no collateral is required. On the downside, this may also mean a higher interest rate.
I don’t have a good credit history (or no credit history at all)
Since the government doesn’t back private loans, your credit history is a consideration in being approved for a loan. If your credit history is bad or non-existent, you may be subject to a higher interest rate. And remember, you can always get a co-signer. Pay your loan off on time, and soon you will have a good credit history!
I have enough funds for tuition and fees, so I can’t get a private loan
In addition to paying tuition and fees, funds from private loans can be used to cover living expenses, supplies, computers, and other everyday living needs.
I can’t afford to make payments on a loan while I am still in school
For most loans, your principal and interest payments can be deferred while you are enrolled in school. Another option is to make interest payments while you are in school but defer paying off the principal. Your interest payments might even be tax-deductible!
I missed the deadline for applying for financial aid this year
You can apply for private student loans any time – there is no deadline. Depending on the financial institution you choose, you can be pre-approved in minutes and have the money (which will be sent directly to you) within a matter of days.
I don’t have a bank to apply through
Private loans are offered by thousands of banks, credit unions, and other financial institutions. Just search the internet for “private student loans” and you will find many places to apply to.
If you need the additional funds provided by private loans, don’t let myths and misconceptions keep you from applying!
This article is distributed by Next Student. At Next Student, we believe that getting an education is the best investment you can make, and we’re dedicated to helping you pursue your education dreams by making college funding as easy as possible. We invite you to learn more about Private Student Loans .
My goal is to help every student succeed – education is one of hte most important things a person can have, so I have made it my personal mission to help every student pay for their education. Aside from that, I am just a pretty average girl from SD.
Get Business Loans Now
You Can Get a Commercial Mortgage Loan From a Hedge Fund – Here’s How – A Wall Street Pro Explains
Corey Beasley asked:
Most stockholders know that hedge funds make business loan loans, but few know how to approach a fund or exactly how secure an approval.
the 1st and most critical thing to keep in mind about hedge fund executives is that they have a Wall Street mindset ; they are traders at heart. A trader wants to get into a trade at the right price, see results quickly and exit the trade at a profit. Hedge funds that commit capital to commercial real estate lending are no different. They want to lend at a low LTV ( loan-to-value ) and get out quickly. Profit takes the form of interest and points, but the general perspective of the choice maker on the loan board is no different from an affiliate of the stock selection committee.
It is vital that you present your loan as a chance for them to make good cash, quickly and safely, not as a method for you to reach your goals. do not talk about your issues ; money executives will be empathetic but may not be sympathetic. Emphasize the powerful points of your deal, your past successes and your strengths as the deal’s sponsor. Keep the conversation hopeful. We all know it’s tough out-there ; complex hedge funds want to fund people who are capable of beating obstacles.
The large majority of non-public lenders, including hedge funds and private equity firms are equity banks. Hard equity in the property is the banks disadvantage risk protection. This is extremely necessary to big money hedge funds because they usually don’t recover their capital by selling their loans to the governing body or to the bond market. Hedge funds are generally’portfolio lenders’, meaning they use their own money to finance deals and hold the mortgage paper until it matures. Do not expect any loan offers from private funds to come in over 65% LTV ( loan-to-value ). If your deal doesn’t meet this criterion, be prepared to inject more of your own cash or find a partner who can bring cash to the closing table.
Your exit method is a supreme concern to hedge fund managers. Funds make’bridge’ loans ; short term, interim financing. They will need to learn how you may pay them back and will need to be convinced that your exit will work. You’ve got to have a detailed, reasonable and credible exit plan worked out before you approach a personal funding source. It helps a-lot if you have an’in’. For good or for unwell, Wall Street works like a private club. They have their own language, their own practices and their own ceremony’s. If you are not member of the club getting their attention is way more tricky. For those on the exterior of this specialized niche, it may be necessary to retain the services of a professional intermediary with the Street experience to get you in the door.
The banks, insurance corporations and brokers aren’t lending like they used to. For many top quality business mortgage loans, non-public money is the only-game-in-town. Hedge funds are flush with money and are hungry to make deals. If a real estate investor can develop a relationship with these unique lenders they’ll enjoy a seemingly never-ending source of funds.
.
Get Business Loans Now
Most stockholders know that hedge funds make business loan loans, but few know how to approach a fund or exactly how secure an approval.
the 1st and most critical thing to keep in mind about hedge fund executives is that they have a Wall Street mindset ; they are traders at heart. A trader wants to get into a trade at the right price, see results quickly and exit the trade at a profit. Hedge funds that commit capital to commercial real estate lending are no different. They want to lend at a low LTV ( loan-to-value ) and get out quickly. Profit takes the form of interest and points, but the general perspective of the choice maker on the loan board is no different from an affiliate of the stock selection committee.
It is vital that you present your loan as a chance for them to make good cash, quickly and safely, not as a method for you to reach your goals. do not talk about your issues ; money executives will be empathetic but may not be sympathetic. Emphasize the powerful points of your deal, your past successes and your strengths as the deal’s sponsor. Keep the conversation hopeful. We all know it’s tough out-there ; complex hedge funds want to fund people who are capable of beating obstacles.
The large majority of non-public lenders, including hedge funds and private equity firms are equity banks. Hard equity in the property is the banks disadvantage risk protection. This is extremely necessary to big money hedge funds because they usually don’t recover their capital by selling their loans to the governing body or to the bond market. Hedge funds are generally’portfolio lenders’, meaning they use their own money to finance deals and hold the mortgage paper until it matures. Do not expect any loan offers from private funds to come in over 65% LTV ( loan-to-value ). If your deal doesn’t meet this criterion, be prepared to inject more of your own cash or find a partner who can bring cash to the closing table.
Your exit method is a supreme concern to hedge fund managers. Funds make’bridge’ loans ; short term, interim financing. They will need to learn how you may pay them back and will need to be convinced that your exit will work. You’ve got to have a detailed, reasonable and credible exit plan worked out before you approach a personal funding source. It helps a-lot if you have an’in’. For good or for unwell, Wall Street works like a private club. They have their own language, their own practices and their own ceremony’s. If you are not member of the club getting their attention is way more tricky. For those on the exterior of this specialized niche, it may be necessary to retain the services of a professional intermediary with the Street experience to get you in the door.
The banks, insurance corporations and brokers aren’t lending like they used to. For many top quality business mortgage loans, non-public money is the only-game-in-town. Hedge funds are flush with money and are hungry to make deals. If a real estate investor can develop a relationship with these unique lenders they’ll enjoy a seemingly never-ending source of funds.
.
Get Business Loans Now