| Frequently Asked Questions |
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| How are Joint Venture deals typically structured, and who does what? |
| We will outline all structural details in the Joint Venture Agreement. The investor(s)' contribution to the subject property is usually a financial one. In other words the investor(s) provide the funds required to purchase the building along the loan from the bank and WEALTHMINDS does all the work. |
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| How do I make money and how does WEALTHMINDS make money? |
| In typical deals and scenarios the equity growth, profits and cash flow are spit 50/50 between investor and WEALTHMINDS. However this is not the case every time. It is in WEALTHMINDS interest to ensure that the investors achieve the highest possible rate of return and cash flow therefore, in some cases WEALTHMINDS will structure the deal to accommodate to assist in the investor’s goals. |
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| Is an Agreement signed between the Investor and WEALTHMINDS? |
| Every deal with WEALTHMINDS will require a signed agreement between all parties with an interest in the subject property. The Joint Venture Agreement details every aspect of who is responsible for what and how and when the profits/cash flows are distributed with regards to the subject property. |
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| Will WEALTHMINDS guarantee the rate of return? |
| Any investment has certain risk associated with it. Real estate values can fluctuate and that no return is guaranteed. The cash flows, rents and expenses are based on reasonable assumptions reflecting the market conditions in the region today and the foreseeable future. They are estimates, and may be higher or lower, depending on a number of factors beyond the control of WEALTHMINDS. However, because our company has vested interest in our properties, we share the same risks as the investor. It is our mandate to provide the best protection our assets. |
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| When can I expect my money? |
| In most cases when buying an investment property, WEALTHMINDS advises the investor not to expect any cash flow for the first 6 months. Any cash flow during that period will go toward the upgrading of the building and/or saving for a healthy contingency fund. Of course if the upgrades are complete ahead of schedule and no more funds are required, the cash flow is simply distributed between the investors as determined in the JV Agreement. Profits are also distributed once WEALTHMINDS with the investor(s) decides to sell the subject property and exit the investment. Other possibility would be re-financed without selling the property for the purpose of purchasing additional investment properties or to distribute as a cash back dividend. |
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| Is real estate a better investment choice compared to available alternatives? |
| An investment in stocks, bonds or mutual funds will buy the equivalent amount of equities. In other words, $100,000 buys $100,000 of equities. However in real estate, the most attractive tactic is the power of leverage. You can purchase real estate investment by putting a small down payment and leveraging the bank’s money to complete your transaction. A property worth $100,000 can be purchased with $25,000 down - or less if it is CMHC insured. You benefit from growth of the property total value, not just the original investment, which multiplies your returns. Your tenant, who essentially buys the investment for you, pays the principal of the mortgage down. |
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| What is the minimum investment? |
| Usually it is a minimum of $25,000 and can go up to $1,000,000 depending on the project at hand. If you are interested in investing with us and want to take positive steps towards your financial future, we'd encourage you to contact WEALTHMINDS for a private consultation. |
