FORMALIZED DUE DILIGENCE PROCESS 
Sponsors

The team at our affiliated broker-dealer, RM Securities, conducts diligence on of the issuer, including detailed background checks, criminal checks, bad actor checks, and reference checks on sponsors. In addition to screening for any criminal background, we may also turn down sponsors due to poor reference checks, even if the background and criminal checks are satisfactory.

Escrow accounts

We require unaffiliated sponsors to use an unaffiliated third-party escrow agent.* When an investor makes an investment with such sponsors using the RealtyMogul platform, the investor’s money is transferred directly into a third-party escrow account. All closing conditions in connection with a sponsor’s contingency offering need to be met before the third-party escrow agent will approve releasing investor funds to the issuer or general partner. For example, if an issuer or general partner plans to use funds for a real estate acquisition that does not ultimately transact, the third-party escrow agent will not transfer investor funds to the issuer or general partner, and funds will be returned to investors.

Unless otherwise disclosed, escrow accounts are not required for some investments that accommodate 1031 investments where the property is already acquired.

Boots on the ground

Our processes typically includes visiting certain properties (or a subset of properties if it's a fund) to confirm the real estate is what and where the real estate is supposed to be. For certain properties that accommodate 1031 exchange investments, the team will review third-party prepared due diligence reports in lieu of a site visit.

Detailed Checklists

We have formalized processes and checklists for every private placement deal listed on the platform.

Confidentiality Agreement
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Completed Debt
Estimated Hold Period 6 months
FUNDED 100%
...
View Our Due Diligence Process
Investment Returns: Discerning investors don't rely on a single projected return metric as a basis to invest. Rather, when assessing a potential investment, we encourage you to evaluate all information provided by a sponsor including the business plan, assumptions, and risk factors which can be found in the relevant offering documents. This approach is consistent with our requirements as a broker-dealer, which prohibit us from communicating projected returns.
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Densmore Single Family Rehab
Offered By
Real Property Associates
Investment Type Debt
Overview
Management
Cumulative Distributions

Real Property Associates

Owned and operated by Gordon Stephenson and Jay Young, the same team who founded the company in 1991, Real Property Associates (RPA) offers an unbeatable blend of knowledge, experience and commitment — both to the community it serves and to a vision of excellent service and innovative solutions.

Backed by its strong, professional staff, RPA has grown steadily over the past 21 years, building on its solid reputation for high ethical standards, sound business practices and proven track record in brokering residential, multi-family, commercial and raw-land real estate.

Located in Seattle, RPA has 43 associate brokers and agents serving clients throughout the Puget Sound Region. In 2011 RPA was named the 2nd largest independent real estate company, and 11th largest residential brokerage in the state, by the Puget Sound Business Journal. In 2010, RPA’s brokerage business consisted of 354 residential and commercial sales transactions which represented over $170 million in gross sales.

RPA looks forward to playing an ongoing part in the region’s growth and continuing to create opportunities for the people who call Seattle home.

RPA also specializes in property management in residential properties and suburban commercial property rentals in the Puget Sound area. Through a state-of-the-art process, they have streamlined property management services, ensuring a more prompt rent collection procedure, a fully electronic payment remittance system, and e-mail reporting of monthly financial information. RPA currently employs over 20 full time property managers, bookkeepers, admins and maintenance personnel. These employees oversee and are responsible for the operations of managing over 1,500 residential and commercial rental units. The combined market value of this portfolio is over $200 million.

Real Property Funding Group, LLC, has operated as a subsidiary of RPA since 1991. It performs mortgage brokerage and other financing services, and since 2010, has acted as a principal, in cooperation with a group of investors, in purchasing, rehabbing, and reselling single family homes and condominiums in the greater Seattle area.

The advantage Real Property Funding Group has is the depth of their market knowledge in the Greater Seattle area. Gordon and Jay have both been active brokers in the Seattle market since the 80’s, and have represented thousands of buyers and sellers during their careers. They personally preview each property that is purchased and directly oversee the rehab process. Upon completion of the work, they have a team of brokers who help with staging, marketing and resell of each home. The average time on market for these transactions is well under 30 days.

In short, the Company provides a vertically integrated approach to investing in this property type – from finding the deal, to closing the purchase, then administering just the right amount of work to ensure the dollars added in the project create incrementally more value to the property, and overseeing a quick sale and closing on the resale, their experience has created a successful model which works well in this current real estate environment.

http://www.seattlehouses.com/
  • Gordon Stephenson
  • Jay Young
Gordon Stephenson

Gordon acts as the managing broker for the company, overseeing 43 agents and brokers in their sales activities, and continues to personally represent buyers and sellers. He is also involved with RPA’s growing commercial real estate division where he provides management and consultation for commercial property owners. Gordon grew up in Lake Forest Park and graduated from North Seattle's Shorecrest High School in 1984. After graduating from Stanford University in 1988 with a degree in economics he returned to Seattle and started working in real estate as a sales agent, first with Mac- Pherson's in their University District location, and then with Windermere at their Northgate office. Gordon lives with his family in Lake Forest Park, North Seattle and serves on the board of trustees with Seattle's Union Gospel Mission (www.ugm.org) and Zillow.com 

Jay Young

Jay partnered with Gordon to start Real Property Associates with the goal of providing excellent brokerage and property management services. Their original office was in Edmonds until they expanded their business and moved to Seattle in 1996. Jay oversees RPA’s property management division. He is also involved in the brokerage area, representing buyers and sellers, and in addition, spends time coordinating the management of Jay and Gordon’s rental portfolio. Jay developed an interest in real estate investing while in college and arranged to receive credit towards his degree for some of his real estate work. For several years he purchased, developed, and managed properties as an investor and partner in properties from Seattle to Everett. Jay is a lifelong resident of Edmonds and a graduate of King's Garden Schools. He graduated in 1988 from Seattle Pacific University with a B.A. in real estate and business. He has served as a board member of the First Avenue Service Center, a homeless shelter in Seattle's Belltown neighborhood and is active in local boys and girls clubs.

Summary

At A Glance

Property Type: Residential, Single-Family
Investment Type: Rehab
Estimated Rate of Return: 8% annualized
Estimated Hold Period: 6 months
Region: Shoreline, WA
   
Purchase Price: $240,000
Loan Value: $170,000
Loan to Purchase Price: 71%
Est. Value After Repair: $310,000
Est. LTV After Repair: 55%
Est. Protective Equity After Repair: $140,000

Summary

Investors in this opportunity will pool their money to make a loan to a real estate investor, Real Property Associates, for the purpose of a rehab.  Real Property Associates is performing renovations on the property and will look to sell as quickly as possible at a higher price than the purchase price.  Upon completion, the property will look like other renovations Real Property Associates has executed.


Investor will receive interest payments of 8%, with a final, balloon payment at the end of the loan term. The loan is secured by the property, in first position.

Risk Mitigation

  • There is a personal guarantee on this transaction.
  • Real Property Associates is a real estate investor with a history and a track record of success.
  • The loan is secured by a deed of trust.
  • The loan is protected by title insurance.
  • Investor returns are not contingent on the appreciation of the home value and investor returns do not increase based on the final sale price. Even if the property does not sell for the projected sale price, the borrower is still obligated to repay the loan.
  • In a worst case scenario, Realty Mogul will foreclose on the property. Upon acquisition of the property, Realty Mogul will facilitate the sale of the property and will distribute the proceeds to investors according to the percentage of the total investment opportunity they initially funded.
Location Information

The property is located in the Echo Lake neighborhood of Shoreline, WA, an urban neighborhood.  The property is located on a quiet, tree-lined street.  The Gateway Shopping Center is within one mile of the property.   Bartell Drugs, Starbucks and local eateries are also within one mile of the property. 

Echo Lake real estate is primarily made up of small to medium sized single-family homes and apartment complexes occupied by a mixture of owners and renters.

The Echo Lake neighborhood also stands out within Washington for its college student friendly environment and the property is approximately two miles from Shoreline Community College.  Other schools in the neighborhood include Echo Lake Elementary School and Shorewood High school.

According to Zillow, home prices in Shoreline are projected to increase 5.9% in the next year. 

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The following offering documents have been prepared and are being delivered by the Sponsor of this investment opportunity, and not by RM Securities, LLC. RM Securities, LLC and its associated persons did not assist in preparing, do not explicitly or implicitly adopt or endorse, and are not otherwise responsible for, the Sponsors offering documents posted below or any content therein.
RM Securities, LLC and its Affiliates Compensation

RM Securities, LLC, its registered representatives, affiliates, associated persons, and personnel of its affiliates who may also be associated with it, including our associated persons and personnel of our affiliates who are also be associated with RM Securities, LLC (it (“RM Securities,” “we,” “our,” or “us”) will receive fees, expense reimbursements, and other compensation (“Fees”) from the issuer of this investment offering, its sponsor, or an affiliate thereof (“Sponsor”), or otherwise in connection with Sponsor’s offering. The Fees paid to us are in addition to other fees you will pay to Sponsor or in connection with Sponsor’s investment offering. You will pay Fees to Sponsor, either directly or indirectly as an investor in the Sponsor’s offering. Sponsor will use the Fees you pay, as well as funds you invest in the relevant offering, to compensate us. The Fees paid to us will directly or indirectly be borne by you as the investor (typically, but not always, in the form of an expense of the Sponsor’s offering in which you invest) because such Fees will reduce the proceeds available for distribution to you and reduce the amount you earn over time.

For more information on the Fees paid to us, or any other Fees you will pay in connection with Sponsor’s offering, please carefully review the Sponsor’s Investment Documents. Please also carefully review RM Securities’ Form CRS, Regulation Best Interest Disclosures, and Limited Brokerage Services Agreement.

No Approval, Opinion or Representation, or Warranty by RM Securities, LLC

Sponsor has provided, approved, and is solely responsible in all aspects for the information on this webpage (“Page”), including Sponsor’s offering documentation, which may include without limitation the Private Placement Memorandum, Operating or Limited Partnership Agreement, Subscription Agreement, the Project Summary and all exhibits and other documents attached thereto or referenced therein (collectively, the “Investment Documents”). The Investment Documents linked on this page have been prepared and posted by Sponsor, and not by RM Securities. We did not assist in preparing, do not adopt or endorse, and we are not otherwise responsible for, the Sponsor’s Investment Documents. We make no representations or warranties as to the accuracy of information on this Page or in the Sponsor’s Investment Documents and we accept no liability therefor. No part of the information on this Page or in the Sponsor’s Investment Documents is intended to be binding on us.

Sponsor’s Information Qualified by Investment Documents

The information on this Page is qualified in its entirety by reference to the more complete information about the offering contained in the Sponsor’s Investment Documents. The information on this Page is not complete and subject to change at the Sponsor’s discretion at any time up to the closing date. The Sponsor’s Investment Documents and supplements thereto contain important information about the Sponsor’s offering including relevant investment objectives, the business plan, risks, charges, expenses, and other information, which you should consider carefully before investing. The information on this Page should not be used as a basis for an investor’s decision to invest.

Risk of Investment

This investment is speculative, highly illiquid, and involves substantial risk. There can be no assurances that all or any of Sponsor’s assumptions, expectations, estimates, goals, hypothetical illustrations, or other aspects of Sponsor’s business plans (“Assumptions”) will be true or that actual performance will bear any relation to Sponsor’s Assumptions, and no guarantee or representation is made that Sponsor’s Assumptions will be achieved. If Sponsor does not achieve its Assumptions, your investment could be materially and adversely affected. A loss of part or all of the principal value of your investment may occur. You should not invest unless you can readily bear the consequences of such loss. Sponsor’s Assumptions should not be relied upon as the primary basis for your decision to invest.

No Reliance on Forward-Looking Statements; Sponsor Assumptions

Sponsor is solely responsible for statements made concerning forward-looking statements and Assumptions, which apply only as of the date made, are preliminary and subject to change, and are expressly qualified in their entirety by the disclosures and cautionary statements included in Sponsor’s Investment Documents, which you should carefully review. Neither RM Securities nor Sponsor are obligated to update or revise such forward-looking statements or Assumptions to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. Sponsor’s forward-looking statements and Assumptions are hypothetical, not based on actual investment achievements or events, and are presented solely for purposes of providing insight into the Sponsor’s investment objectives, detailing Sponsor’s anticipated risk and reward characteristics, and establishing a benchmark for future evaluation of actual results; therefore, they are not a predictor, projection, or guarantee of future results. You should not rely on Sponsor’s forward-looking statements as a basis to invest.

Importantly, we do not adopt, endorse, or provide any assurance of returns or as to the accuracy or reasonableness of Sponsor’s Assumptions or forward-looking statements.

No Reliance on Past Performance

Any description of past performance is not a reliable indicator of future performance and should not be relied upon as the primary basis to invest.

Sponsor’s Use of Debt

A substantial portion of the total cost of the real estate asset acquired by the Sponsor with investor funds (“Property”) will be paid with borrowed funds, i.e., debt. Sponsor’s estimated rates and terms of the debt financing are subject to lender approval, and there is no assurance that the Sponsor will secure debt at the rates and terms presented on this Page or in the Sponsor’s Investment Documents, or at all. The use of borrowed money to acquire real estate is referred to as leveraging, which can amplify losses and could result in lender foreclosure. In addition, if the debt includes a variable (or “floating”) interest rate, the total amount of interest paid over the term of the debt will fluctuate and can increase. As a result, Sponsor’s use of debt can result in a loss of some or all of your investment.

Sponsor’s Offering is Not Registered

Sponsor’s securities offering will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon the exemptions from registration pursuant to Rule 506(c) of Regulation D as promulgated under the Securities Act (“Private Placement”). In addition, the offering will not be registered under any state securities laws in reliance on exemptions from state registration. Such securities (your ownership interests) are subject to restrictions on transferability and resale and may not be transferred or resold except as permitted under applicable state and federal securities laws pursuant to registration or an available exemption. All Private Placements on the Platform are intended solely for “Accredited Investors,” as that term is defined in Rule 501(a) under the Securities Act.

No Investment Advice

Nothing on this Page should be regarded as investment advice (either with respect to a particular security or regarding an overall investment strategy), a recommendation, an offer to sell, or a solicitation of or an offer to buy any security. Advice from a securities professional is strongly advised to understand and assess the risks associated with real estate or private placement investments. For additional information on RM Securities’ involvement in this offering, please carefully review the Sponsor’s Investment Documents, and RM Securities’ Form CRS, Regulation Best Interest Disclosures, and Limited Brokerage Services Agreement.

1031 Exchange Risk

Internal Revenue Code Section 1031 (“Section 1031”) contains complex tax concepts and certain tax consequences may vary depending on the individual circumstances of each investor. RM Securities and its affiliates make no representation or warranty of any kind with respect to the tax consequences of your investment or that the IRS will not challenge any such treatment. You should consult with and rely on your own tax advisor about the tax aspects with respect to your particular circumstances.

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