DMAC CAP FUND I - Hard Money Mortgage Fund

Min. Invest
$50,000
Target Hold
36 mos.
Potential Yield
12%
Progress - 0% Pledged
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Hard Money Bridge Fund.

Hard Money Bridge Funding - Multifamily and Residential

Principal Investment Objectives

The Fund’s objectives with respect to acquiring Fund Assets are:

• To effectively deploy the proceeds of this Offering in well qualified Fund         Assets;
• To distribute a monthly Preferred Return of 6% (annualized);
• To provide Members with an overall aggregated annual return of 10-12%; and
• To ultimately provide Members with a return of 100% of their Capital contributions.
No assurance can be given that these objectives will be attained or that the Fund’s capital will not decrease.

The Fund will pursue its objectives by originating and acquiring loans secured by real property located primarily in Texas, (the “Mortgage Loans”), but may allow property to be secured in additional markets nationwide, in the sole discretion of the Manager. Loans will be originated by the Manager and closed by the Fund, or the Manager may close loans and then sell them to the Fund on market terms. The Fund’s strategy is to pursue opportunities to make hard money bridge purchase and refinance loans for income producing multifamily commercial real estate properties, and some non-owner occupied residential properties.

WE ARE PROVIDING A SECURE, HASSLE FREE AND PREDICTABLE STREAM OF INCOME FOR OUR INVESTORS!  PAID OUT MONTHLY

Management

Bridge Loan matrix- Multifamily

Bridge Loans Matrix- Residential

Form of Security Equity
30/70 Waterfall Participation
Term 36 Months
Offering Size $20,000,000
Target IRR 12%

Financial Summary

This is a financial model of an annual return.  This model does not include origination fees and profit participation which we take part in on most deals we fund.  This participation increases revenue and return on investment.  We charge anywhere from 3% to 5% of the loan amounts for origination and our profit participation can range anywhere from 5% to 10% profit participation.  Some cases we charge borrowers and early payoff fee of 1%. which is not included.  These additonal fees will increas profits and our investors rate of return. 

FInancial Model

Development Control and Management

Most of our ground up construction loans will require DMAC Capital Funding and its construction team to control or management construction process to insure and protect the investment.  With over 15 years of multifamily and residential construction experience we will mitgate the risk for ground up construction project funding. 

Financial Sources

Equity $20,000,000

Financial Uses

Mortgage Bridge loans $20,000,000

Property Summary


Address Property Type

, TX
Fund

Market Summary

Multifamily Real Estate Investing

Investing in multifamily properties is a great option for those looking to get into real estate investing and feel comfortable with the responsibility and time commitment. Done right, they can be a great source of passive income. However, it’s important to have an in-depth understanding of how to find properties that will provide worthwhilreturns on your investment, and subsequently acquire them. Crunching the numbers instead of being influenced by extraneous factors will quickly give you comprehensive insight into an overall project.

 

What is multifamily housing?

A multifamily property is any residential property that consists of more than one housing unit and allows more than one family to live separately. Duplexes, triplexes, townhomes, apartment complexes, and condominiums are all examples of multifamily properties. Buildings with more than four units are considered commercial properties.

As the owner of a multifamily asset, you can either live in one of the units and rent out the others or live in a different property and rent them all out. If you live in one of the units, the building is considered an owner-occupied property. If you don’t live on-site, you’re considered an investor. This is important to know because the rules for obtaining a loan or mortgage are different for occupying owners and investors.

 

Real estate financing options for multifamily investments

Financing options for multifamily housing investments include cash financing, hard money lenders, banks, seller financing, and peer-to-peer lending. Generally speaking, every opportunity will be different, and which financing route you choose will depend on your timeline, your financial situation, and other factors. As mentioned previously, if you choose to live in one of the units while renting out the others, your property would be considered owner-occupied. This means that when you’re looking for financing options, the second unit’s income will be factored into the lender’s qualifying factors and may make it harder to find a loan.

 

How to buy multifamily properties

Much like purchasing a single-family home, there are real estate websites such as LoopNet.com that allow you to filter results for the type of property you are looking for. Another option is to work with a real estate agent who specializes in multifamily housing. They may have a greater understanding of opportunities in your area and even some that have not yet hit the market. If you’re looking to invest in a duplex, triplex, apartment building, or condominium complex, you can begin your search with this checklist:

  • Location: Location is one of the most important factors for real estate investors, particularly for multi-family properties. You should choose an area with high employment, well-maintained neighborhoods, population growth, and where housing is in high demand.
  • Number of units: Evaluate the property as a whole. Investors should consider the number of units in the property, including the number of rooms in each unit. If you’re a beginner, we recommend beginning your real estate search with three types of multifamily properties: duplexes (two units), triplexes (three units), or four-plexes (four units). Typically, these properties have the most upside with the least amount of risk.
  • Potential income: The next step is to determine how much income a property can generate. There are websites such as Rentometer.comZillow, and Realtor.com that let you analyze rental rates based on the size and location of your property. If you’re looking to remain conservative, you can use the 50 percent rule. As the name suggests, you should estimate your operating expenses to be 50 percent of the gross income. So, if a rental property makes $40,000 per year in gross rents, you should assume $20,000 would go towards expenses. This does not include the mortgage payment.

 

The benefits of multifamily investing

Some benefits you can expect when investing in a multifamily property and which will make your investment worthwhile include:

  • Greater cash flow: Unlike single-family properties, which generate one source of monthly income, multifamily properties draw rents from multiple units.
  • Less risk: When investing in single-family rentals, income is lost when the home is vacant. However, because multifamily properties have numerous units, you can offset the loss of income from one vacant unit with the income from others.
  • Taxes: You can make more income by renting to multiple tenants while only paying taxes on one building. You can also write off some of your home maintenance as a business expense and prorate part of your mortgage interest payments.
  • Scalability: With multifamily investments, the multiple units involved count as multiple properties instead of a single-family home representing one property. It’s a great step towards growing your real estate investment portfolio and possibly venturing into mixed-use and/or larger apartment properties.

 

The challenges of multifamily investments

Despite all the benefits of investing in multifamily properties, there are some downsides, which include the following:

  • Multiple units = higher cost: Multifamily investment properties usually cost more upfront. You also need to factor in the maintenance costs of multiple units.
  • Being a landlord: Finding and managing tenants is a time commitment. If you live near your tenants, you may get knocks on your door throughout the day with maintenance-related questions. And you’ll need to feel comfortable screening and negotiating lease terms with your tenants.
  • Selling the property: It can be more complicated to sell a multifamily property that has tenants because you’ll have to coordinate showings and appraisals.

 

Setting yourself up for success

On top of the considerations we’ve outlined, does the property allow for a healthy return on your investment—in terms of both time and capital—or is it a deal that’s too good to be true? Performing your own due diligence is critical to determining which properties will allow you to extract the most value. Additionally, knowing when to say no to a deal is just as important as knowing which projects are worth it.

DMAC CAPITAL FUNDING, LLC is an internally managed real estate investment managment company offering short-term, first deed of trust loans secured by real estate to fund the acquisition, renovation, rehabilitation, or development of residential or commercial properties.Contact one of our lending experts today.

Strategy Summary

The Fund’s strategy is to pursue opportunities to make hard money bridge Purchase and refinance loans for income producing multifamily commercial real estate properties, and some non-owner occupied residential properties.

 

Frequently Asked Questions

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Investor Tutorial

CERTAIN INFORMATION REGARDING THIS OFFERING

THESE UNITS ARE BEING OFFERED WITHOUT REGISTRATION UNDER ANY FEDERAL OR STATE SECURITIES LAWS, BUT ARE BEING OFFERED UNDER AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND UNDER COMPARABLE EXEMPTIONS UNDER VARIOUS STATE SECURITIES LAWS. HOWEVER, THE SECURITIES AND EXCHANGE COMMISSION (“COMMISSION”) HAS NOT DETERMINED THAT THESE UNITS ARE EXEMPT FROM REGISTRATION. THESE UNITS HAVE NOT BEEN REVIEWED, APPROVED OR DISAPPROVED BY THE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY, ADEQUACY, COMPLETENESS OR MERITS OF THIS MEMORANDUM, AND ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THIS MEMORANDUM DOES NOT CONSTITUTE AN OFFER TO SELL TO, OR A SOLICITATION OF AN OFFER TO BUY FROM, NOR SHALL ANY OF THE UNITS BE OFFERED OR SOLD TO, ANY PERSON IN ANY JURISDICTION IN WHICH SUCH AN OFFER, SOLICITATION, PURCHASE, OR SALE IS UNLAWFUL OR UNAUTHORIZED UNDER THE SECURITIES LAWS OF SUCH JURISDICTION.

THE STATEMENTS MADE HEREIN ARE MADE AS OF THE DATE ON THE COVER OF THIS OFFERING MEMORANDUM. THIS OFFERING MEMORANDUM CONSTITUTES AN INVITATION TO THE PROSPECTIVE INVESTOR TO SUBMIT AN OFFER TO SUBSCRIBE. NO PERSON MAY PURCHASE THE UNITS OFFERED HEREBY EXCEPT PURSUANT TO AN EXECUTED SUBSCRIPTION AGREEMENT IN THE FORM PRESCRIBED BY THE FUND, AND THEN ONLY FROM A PERSON TO WHOM THE FUND OR ITS DESIGNATED AGENT HAS DELIVERED A COPY OF THIS OFFERING MEMORANDUM.

THESE UNITS ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED BY THE FUND. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THERE IS CURRENTLY NO PUBLIC MARKET FOR THESE UNITS.

IN MAKING A DECISION TO PURCHASE UNITS HEREUNDER, PROSPECTIVE INVESTORS MUST CONDUCT THEIR OWN INDEPENDENT INVESTIGATION OF THE FUND AND THE TERMS OF THIS OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED, AND ARE ENCOURAGED TO CONSULT WITH THEIR ADVISORS AS THEY WILL BE REQUIRED TO REPRESENT THAT THEY ARE ABLE TO BEAR THE ECONOMIC RISK OF THEIR INVESTMENT AND THAT THEY ARE FAMILLIAR WITH AND UNDERSTAND THE FUNDAMENTAL RISKS AND TERMS OF THIS OFFERING.

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATION WITH RESPECT TO THE OFFERING OF THE UNITS WHICH IS NOT CONTAINED OR REFERENCED HEREIN, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. POTENTIAL INVESTORS MAY, IF THEY SO DESIRE, MAKE INQUIRIES OF THE FUND WITH RESPECT TO THE FUND’S BUSINESS OR ANY OTHER MATTERS SET FORTH HEREIN, AND MAY OBTAIN ANY ADDITIONAL INFORMATION WHICH SUCH PERSON DEEMS TO BE NECESSARY IN ORDER TO VERIFY THE ACCURACY OF THE INFORMATION CONTAINED IN THIS MEMORANDUM (TO THE EXTENT THAT THE FUND POSSESSES SUCH INFORMATION OR CAN ACQUIRE IT WITHOUT UNREASONABLE EFFORT OR EXPENSE).

June 19 2021

Confidential Offering Memorandum: DMAC Capital Funding, LLC

PROSPECTIVE INVESTORS ARE CAUTIONED NOT TO CONSTRUE ANY CONTENTS OF THIS OFFERING MEMORANDUM OR ANY PRIOR OR SUBSEQUENT COMMUNICATIONS, AS CONSTITUTING INVESTMENT, LEGAL OR TAX ADVICE; RATHER THEY SHOULD CONSULT THEIR OWN ADVISORS OR COUNSEL WITH THE CAPACITY TO ADVISE AND PROTECT THEIR INTEREST IN CONNECTION WITH ALL MATTERS CONCERNING THIS OFFERING MEMORANDUM.

THIS OFFERING MEMORANDUM DOES NOT KNOWINGLY CONTAIN ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT A MATERIAL FACT, AND ANY SUCH MISSTATEMENT OR OMISSION IS DONE WITHOUT THE KNOWLEDGE OF THE PREPARERS OF THIS DOCUMENT OR THE FUND. AS SUCH THE FUND BELIEVES THAT THIS OFFERING MEMORANDUM CONTAINS A FAIR SUMMARY OF THE MATERIAL TERMS OF ALL MATTERS, DOCUMENTS AND CIRCUMSTANCES MATERIAL TO THIS OFFERING. WHILE THE DATA AND STATEMENTS CONTAINED HEREIN ARE BASED UPON INFORMATION BELIEVED TO BE RELIABLE, NO WARRANTY CAN BE MADE AS TO THE ACCURACY OF SUCH INFORMATION OR THAT CIRCUMSTANCES HAVE NOT CHANGED SINCE THE DATE SUCH INFORMATION WAS SUPPLIED. THIS MEMORANDUM CONTAINS SUMMARIES OF CERTAIN PROVISIONS OF DOCUMENTS RELATING TO THE BUSINESS OF THE FUND AND THE UNITS OFFERED HEREBY, AS WELL AS SUMMARIES OF VARIOUS PROVISIONS OF RELEVANT STATUTES AND REGULATIONS. SUCH SUMMARIES DO NOT PURPORT TO BE COMPLETE AND ARE QUALIFIED IN THEIR ENTIRETY BY REFERENCE TO THE TEXTS OF THE ORIGINAL DOCUMENTS, STATUTES AND REGULATIONS.