Questions, Questions, Questions
You understand your funding requirements inside out, that’s a given. You have researched the markets fully, and you should have worked out by now how much you would like your angel to invest, and when you need it. You have several networking events under your belt and your phone is busting at the seams with great contacts. So, where is the money? Well, angels do like to ask questions, and preparation is everything. Here is a heads up of some questions, with example answers you may want to use, that might be asked during these events:
Q: What if you buy at the peak of the market and house prices crash?
A: We look to buy and hold for the long term, so prices remain largely unaffected by fluctuations in the short term. We always follow market trends closely to safeguard investors’ capital, while always buying to a qualified demand and ROI. Finally, we don’t take on properties with an LTV over 75%, stress testing to withstand sudden/large interest rate increases.
Q: Is it complicated?
A: By leveraging our trusted network of qualified people we can source deals, manage renovations and re-value/re-sell without any input needed from you.
Q: Are you flexible with investments?
A: We offer basic tiered returns from x% depending on the length of investment and repayment method. We usually target a minimum investment of £x but aim to agree on the right investment package for investors, this means we can consider lower amounts on request.
Q: How reliable are you?
A: We only buy to qualified demand, aiming at a minimum of x% below market value (BMV), using an experienced and trusted team.
Q: What is the risk if a Covid-19 event happens again?
A: By investing at a low ratio, we don’t manage hundreds of property investments at once, meaning retained profits and rental protection insurance will cover projects. Plus, investments are stress-tested at an x% interest rate.
Q: What if you can’t release equity to pay me back?
A: We retain capital reserves to ensure liquidity. Keeping in touch ensures maximum transparency in case of extenuating circumstances.
Q: What security can you offer on my investment?
A: We offer tiered levels of security subject to the loan amount and term.
Q: What are your rental areas?
A: Our investment areas are [enter area] in the UK, where high rental yields and qualified rental demand ensure monthly cash flow. We target a minimum x% ROI and x% rental yield.
Q: Will I get my investment back if the deal falls through?
A: In short – yes. Details will be agreed within the loan agreement.
If no contract was in place for the purchase of the property, then no capital has been committed and can be easily repaid.
If other deals are running in parallel, we may be able to invest the money in those but would always work with you offering options should the deal not proceed.
Q: How do I know you will use the money for a property deal only?
A: We pride ourselves on transparency and share regular progress reports throughout the process. It is also written into the loan agreement to ensure you are always protected.
Q: Who pays the legal fees for the agreement?
A: The investment agreement has been drafted by one of Manchester’s leading firms of commercial solicitors. We do, however, suggest our investors take independent legal advice on all agreements. The investor will bear the costs of this.