As Seen in:
Rental Transaction Overview
APEX Capital Group is the operator in all of these transactions and is responsible for procuring the properties and conducting all necessary due diligence.
These responsibilities include:
1. Analyzing all of the financial aspects of each property for both cash purchases and leveraged purchases.
2. Conducting all inspections
- radon testing
- underground storage tank sweeps
- home inspections
3. Working with the township to obtain certificates of occupancy and smoke certification.
APEX Capital Group coordinates with attorneys, sellers, agents, title, and insurance to close the property. Upon closing, we work closely with the property management company to ensure that all aspects of the property have been taken care of, including project management for renovations, marketing for tenants, vetting and placing of tenants, collecting deposits and monthly rent, cash control and banking, conducting inspections of the property, and making recommendations to enhance net operating income.
FREQUENTLY ASKED QUESTIONS
1. How do you locate and acquire these properties?
Through our extensive marketing campaigns, networks of real estate professionals, and years of expertise, we are able to identify properties before they are available to the general market. As such, we are able to acquire them at deep discounts.
2. Who owns the rental property?
The investor owns 100 percent of the property. There are several methods of structuring the purchase including:
1. Purchasing it under a newly formed LLC — usually a cash purchase
2. Purchasing it under the investor’s personal name — usually a leveraged purchase
3. Purchasing it under the investors IRA account using retirement funds
3. What services does APEX Capital Group provide?
ACG acts as the operator in this transaction, which means that we are responsible for procuring the properties and conducting all necessary due diligence. We will assist you in conducting all inspections and coordinate the parties involved in the transaction, including the seller, attorneys, title companies, property management team, and any others involved. APEX Capital Group does not function as the partner’s personal accountant, lawyer, or financial advisor.
4. How involved do I need to be?
The level of your involvement is at your discretion as the investor. You can be as active or passive as you choose. As the investor, you will defer to the expertise of APEX Capital Group to ensure that the asset is operating at its peak potential. Due to our vested interest in the property, there must be an understanding that we will work to maximize the rental income and minimize the expenses of the property for all parties involved.
5. If I don’t have the full funds to purchase a property with cash, then what are my options?
You have several options available to you:
Option 1. Use the cash you do have as a down payment on the house and leverage the remaining balance through a mortgage.
Option 2. Pool your funds with several investors who are your friends or family.
- Returns will be distributed based on the percentage of each contribution.
- Each investor will be a managing member of the LLC that owns the property
Option 3. Pool your funds with one other family member or friend.
- Leverage the remaining amount through a mortgage.
- Each investor will be a co-signer on the loan
- Each investor is considered a co-owner on the deed of the property.
6. How much money will I need to close?
If you leverage your purchase, then you will need your full down payment amount, funds to cover the costs of repairs, the APEX Capital Group acquisition fee, and the full closing costs. Closing costs are generally between 3-5 percent of the purchase price of the property.
If you are making a cash purchase, then you will need the full ACG acquisition price, funds to cover the costs of repairs, inspection costs, and the title fees.
Total inspection costs are generally $600 to 700 and the title fees are usually between $1500 to $2000 altogether.
7. Is there a risk for loss on these purchases?
As with any investment, there is an inherent risk and a chance of gain or loss. Our investors acknowledge that the APEX Capital Group cannot make any guarantees or promises with regards to gains and/or losses. However, because we are able to acquire all of our investment properties at such a deep discount, we are able to offer each of these properties to our real estate investors at wholesale prices. As a result, there is intrinsic equity in each property and the potential for a steady appreciation from market recovery.
8. What governs the relationship between APEX Capital Group and the investor?
There are several mechanisms put in to place to protect the interests of all parties involved in each transaction. These mechanisms are also dependent on the manner in which a property is purchased. All rental property purchases are governed by the Turn-Key Income Property Agreement, which outlines the relationship between the Operator, APEX Capital Group, and the investor, you. Additionally, when the property is purchased by an LLC, an Operating Agreement is in effect between all the parties. We advise you to consult with an attorney for further, detailed legal advice.