Lowering risk in real estate investing.

The first is capital risk ( the money you put in ) the second is debt ( the money you owe ) the third is liability ( responsibility for what happens through towing and operating).

This is our strategy to lower all three.

First is the capital we put in.

We use a value add strategy. Meaning we buy assets that we can improve the cash flows through effective operations.

That way we can quickly refinance the property and get all our money back plus profits while keeping the debt load the same.

Second is debt. After increasing cashflow and value we refi into a none recourse loan.

This means we are not personally liable for the debt is that asset fails.

Now we have all our money back plus profit and continual cashflow. We own the asset but not the debt liabilities.

Third is liability.

We set our operating company up as it’s own entity with its own contracts to all of our assets. If something happens because of operating it is that company not the one that owns the assets.

Each asset is in a LLC and all those are owned by my holdings company. We drain the capital out and up to the holdings company so there’s nothing to go after.

This also only lets a person go after just one LLC not all of it. Stoping liability spread.

Finally lots of insurance!!!

Sorry for bad spelling and grammar I am dyslexic.