If you’ve been thinking about investing in real estate but aren’t sure where to begin, Groundfloor may be a good place to start.
Groundfloor has made investing more accessible than ever before, with a low minimum investment amount and remarkably low fees.
This review will go over Groundfloor to see if it really is the best real estate investments course out there.
You’ll learn whether real estate is the right online business for you.
And at the end, you’ll find answers to some of the most frequently asked questions regarding Groundfloor and investing in real estate investing in general.
But most importantly, you’ll see the exact system many others have used to build their own internet marketing business to over $40,000 a month in mostly passive income.
This system made them swear off real estate investing for good because it uses some of the same skills but in a much more powerful and profitable way!
Groundfloor is a wealthtech business that provides the general public with high-yielding, short-term real estate debt investments. Groundfloor is considered one of the popular real estate crowdfunding platforms or real estate investment platforms.
Their platform is geared toward small-scale home development projects. This is a ground-breaking way to manage personal finance. This is a constant, measurable method for regular people to earn good returns on their investments.
Groundfloor is one of the real estate investment platforms that connects individual investors seeking short-term loan investments with borrowers asking for short-term funding for their projects. Borrowers benefit from more flexible, quicker, and less expensive funding than a conventional bank or hard money lender.
Investors get access to short-term, high-yield investments with returns ranging from 6% to 14%, depending on the risk grade of the particular loan. Groundfloor presently offers several Grade G loans with anticipated yields of up to 25% on its platform. Just keep in mind that the larger the anticipated return, the greater the danger.
If you’ve looked at real estate crowdfunding platforms as an investment possibility, you’ve probably seen that most sites only allow accredited investors to participate. Groundfloor has broken the mold by creating a real estate crowdfunding platform that allows anybody with as little as $10 to lend money for realty fix-and-flip transactions.
The Securities and Exchange Commission (SEC) has registered Groundfloor to conduct business in California, Georgia, Illinois, Maryland, Massachusetts, Texas, Virginia, Washington, and Washington, D.C.
Real estate debt investments allow borrowers to acquire short-term financing for a range of real estate projects, which implies that the borrowers are usually developers or experienced investors.
Real estate debt investing may include a variety of projects including construction loans, multi-family complexes, and industrial units, to mention a few.
Typical real estate debt investments are made up of equity-backed money that may be loaned to asset owners as well as prospective purchasers of properties.
Anyone who participates in this kind of investment will often get periodic payments from the interest charged against the capital as well as security levied against a property’s assets.
Every debt fund usually has a particular investing strategy at its core.
Brian Dally and Nick Bhargava created GROUNDFLOOR in 2013. The company is headquartered in Atlanta, Georgia, and has a rapidly expanding team dedicated to reformatting and opening private capital markets for the benefit of individual investors and the real estate projects they finance.
The process begins with the borrower searching for a loan to fund a home repair or restoration project. Groundfloor examines the details and does due diligence on the deal and the borrower.
If Groundfloor agrees to underwrite the loan, it is given a loan Grade A through G and a matching rate of return, with Grade A loans having the least investment risk (having the lowest rate of return) and Grade G loans being the riskiest (having the highest rate of return with the highest rate of return).
Location, lien position, borrower commitment, skin-in-the-game, and other factors are used by Groundfloor to grade a loan and determine a rate.
The ultimate rate is determined by variables such as loan amount, loan duration, personal guarantee, history with Groundfloor, creditworthiness, and others.
Grade A loans typically provide returns of about 6%, while Grade G loans often offer returns of up to 25%, with each letter grade providing a rate in between:
To begin, simply connect your checking or other nominated account to your Groundfloor account and fund it. You transfer money, and after your Groundfloor account is loaded with money, you choose the project(s) in which you want to invest.
You may see additional details on each loan’s detail page after browsing the overview page of loans being financed on the platform. You get to choose when, how much, and where to invest.
Investors have up to 45 days to finance the loan once the transaction is ready for financing. The loan is often for six to twelve months, although it may be shorter or longer.
You are technically investing in a Limited Recourse Obligation (LRO), which is a debt instrument issued by Groundfloor.
Borrowers in 23 states may get loans ranging from $75,000 to $2 million with interest payments as low as 5.4% (for a Grade A loan on a three-month term with monthly payment). Groundfloor will finance up to 90% of the cost of a project and up to 70% of the after-flip value.
Borrowers may also opt to make no payments throughout the loan’s duration. These conditions are very advantageous when compared to hard money lenders, who usually charge 12–15 % interest and demand a stricter loan-to-value (LTV) ratio.
When a loan is completely financed, the borrower withdraws funds on a predetermined timetable and completes the remodeling or rehab project.
The property is then advertised, sold, and closed.
After the transaction is completed, the borrower repays Groundfloor, and a lump amount of the principal and interest payments is paid into the accounts of all investors who participated.
The ability to invest in private realty even for non-accredited investors is probably Groundfloor’s most significant benefit.
To be clear, a few other websites, like Modiv and Fundrise, enable non-accredited investors to invest in private real estate via real estate investment trusts (REITs).
Fundrise, for example, is a private REIT that provides investors with access to private real estate. The distinction is that Groundfloor provides direct access to private real estate rather than investing in a specific management firm.
DiversyFund, like Groundfloor, allows non-accredited investors to diversify into realty investment. The distinction is that Diversyfund has a $500 minimum starting requirement.
Diversyfund may not charge an annual management fee for each project, but it does charge a 2 to 8% developer fee to seek, manage, and purchase each investment.
When a property is sold, the investor receives a 7% return before the business earns a profit. If the property earns more than 7% profit, it is split 65/35 between the investor and the business until the investor obtains 12% returns each year. The remaining profit is split 50/50 between the investor and the company.
Groundfloor does not provide financial advice for both accredited and non-accredited investors. When it comes to selecting your investments and monitoring interest payments, you will be on your own.
Although the loan details pages include a wealth of information on each investment, they should not be construed as financial advice.
All Groundfloor loans are for the short term. The average loan term is 12 to 18 months, with some loans being considerably shorter.
When you invest with Groundfloor, you cannot take your money out early. You will not be able to access your invested money until the loan is paid off.
Yes, You can!
There’s a lot that comes along with investing that many people struggle with, considering one’s personal finance, or if you are not sure if you still fall in the “non-accredited investors” category.
Now, don’t get the wrong idea…
It’s not impossible to make money investing, but if you’re gonna put in the amount of grueling work to do this business (which, trust us, isn’t easy), you might as well bring in some REAL money while you’re learning the ropes.
The program that helped skyrocket many online businesses to over $40,000+ per month is so simple that making money really does become second nature.
Groundfloor is safe when it comes to internet security. They employ bank-level online investor security measures.
Until it is invested in a deal, all funds sent into your account in GroundFloor are FDIC insured.
It is essential to remember that all investments include some level of risk. This risk, however, is associated with the investment rather than the platform.
It is entirely possible to build a profitable, successful real estate business… But there are better ways to build a business other than investing in real estate.
Our #1 pick proves this. Because, unlike Groundfloor, it actually provides real proof of real success from real people as recently as a few days ago.
But, when it comes to building a business, you have plenty of options.
And even if you’re dead set on becoming a real estate investor, you’ve got way better options than crowdfunding.
Keep in mind, I don’t get paid to promote any of the programs we review. I personally think real estate is a great business model, but you could end up leaving way too much money on the table.
Investing in private realty without being an accredited investor is probably Groundfloor’s most significant benefit.
You may fund your account with as little as $10, the lowest investment requirement of any real estate crowdfunding platform presently accessible.
You can set up your account, fund it, and distribute your assets with a few mouse clicks.
Groundfloor must ensure that each deal benefits investors, which implies that due diligence on the deal and the borrower is a top focus.
You may diversify your lending by making a number of loans distributed over various geographical regions and different rehabbers/borrowers.
Funding these deals with funds generated from ordinary non-accredited investors is a brand-new, unproven business model.
You have no control over the project, and everything may go wrong.
Investing in LROs entails considerable risk, and you may be forced to keep your investment indefinitely.
Groundfloor is a peer-to-peer investing platform for fix-and-flip homes that is available to non-accredited investors. Because of the modest investment amount, everyday ordinary people get a chance to become private real estate entrepreneurs – and allows to diversify risk over several individual projects.
Groundfloor may be a good investment for you if you’re prepared to take on greater risk in exchange for somewhat greater returns.
This platform should be considered by investors who do not need liquidity and are ready to explore. It’s a passive method to get started in the fix-and-flip business of investing in realty.
If you are an accredited investor, you may, of course, invest on Groundfloor’s platform, but there are many alternative investment platforms to choose from that should be looked into for comparison.
However, if you are interested in passively investing in fix-and-flip residential properties but are not an accredited investor, it is worth your time to look into Groundfloor. It’s one of the few platforms that welcome non-accredited investors — and the only one that enables them to participate in private realty transactions rather than REITs.
And, with a minimum investment of just $10, you may get access to diversity even if you only have a little amount to contribute.
Where this GroundFloor falls short is in scalability.
Because in order to make a good amount of money with real estate, you have to
own several different houses.
And who has that kind of capital to start?
But what if you went local?
With Local Lead Generation, you will be getting service requests from multiple sites at every minute of the day from people who are willing to pay a lot of money for what you can provide them.
I was watching a YouTube video once where the host made a comment that it isn’t about making a lot of money from one website… it’s about making a little bit of money from lots of different websites.
So, think of it this way….
What if you could have streams of investment income where you operated 10 rental units that you could charge anywhere from $750-1,000 per month?
That’s $7,500-10,000 per month in passive income!
What If You Invested Into 100 Rental Units?
But instead of spending $Millions to build houses or apartment complexes… you spend a couple hundred dollars to build websites.
You then get those websites ranked in the search engines for specific home-based services that customers are searching for.
Next, you offer your lead generation system to local business owners who are looking for customers and are willing to pay you for their information.
You’ve just created a Digital Real Estate Investment Empire that is potentially earning you 4-5 figures in PASSIVE INCOME on a monthly basis without spending a single dime on ads.
With conventional digital real estate, you have to compete with thousands, if not millions of others who are selling the SAME product to the SAME customers.
Once the training program is completed you will also have access to a Facebook group much better than the Real Estate Investments group in our opinion. This group is much more active.
Unlike Real Estate Investments, where you’re profiting maybe $250 per property, you could be getting 5-10X THAT.
With Local Lead Generation, the competition is virtually nothing and your profit margins are 85-90%.
Now, I could go on and on, but I’m sure you have tons of questions about how to create Digital Real