Who invests in STREF?
The Fund is open to accredited investors only. STREF is an appropriate investment for individuals and institutional investors who are seeking a consistent high-yield return with low volatility and collateral protection. It is also suitable for investors who want passive income from regular distributions and those who would like to diversify their overall portfolio away from traditional investments like stocks, bonds, and government debt. Because the Fund invests in notes backed by real estate, investors driven by capital preservation are still able to enjoy returns more typical of riskier high yield assets.
What is an accredited investor?
An accredited investor is an individual who has income of at least $200,000 over the previous two years (or $300,000 with a spouse) or who has assets worth at least $1M outside the value of a primary residence.
Who borrows from Stallion and why are they willing to pay a higher interest rate?
Clients borrow from Stallion when they have the opportunity to profit from real estate investments but bank financing is unavailable or impractical. The borrower may have a very short time frame to purchase the property, may have certain credit challenges, or the property may be outside of a bank’s scope of lending. Our fast turnaround time and excellent service allow the borrower to take advantage of real estate opportunities that would otherwise be missed.
How are these loans structured?
Loans are typically 12 month, interest-only loans with a balloon payment due at maturity. Payments are due from the borrowers monthly. Borrowers have the right to repay the loan completely before the balloon is due, however he or she must pay at least four months of interest.
How is my investment secured?
All investments are secured by first lien deeds of trust. In the event of a foreclosure, Stallion will handle the entire process, assume ownership of the property, and either sell it, manage it until it becomes profitable to sell, or continue to collect the cash flow if it is an income-producing property. The advantage of a fund structure is that if any individual loan results in a lower than expected yield or capital loss, the effects on the investor are minimal as they are offset by the positive performance of multiple other loans.
What is the minimum investment to get started??
The average investment is around $250,000, though we require a minimum investment of $100,000 to begin investing in the Stallion Texas Real Estate Fund.
How do I get started?
Please contact Stallion Capital Management to request a copy of our Private Placement Memorandum (PPM) and Subscription Document. Once you have reviewed the documents and have had your questions answered, we can walk you through what is required on the Subscription Agreement.
How do I receive dividends?
Fund investors will receive quarterly dividends through check or direct deposit unless they have chosen the reinvestment option. Investors receive quarterly distributions between the 15th and the 20th of the month following the end of each quarter. This is normally slightly later in January.
Can I change my mind about reinvestment?
Investors can change their reinvestment option as many times as they like. Note that this can only be done quarterly and due notice will be required.
When can I add to my investment?
Investors can add to their account at any time. All investments are converted to shares in the Fund at the end of the next quarter. However, investments are paid a flat 8% interest rate once deployed into a loan through the end of that quarter. This period of time before deployment is often less than a week but can be 4-5 weeks depending on loan volume and the amount of new capital in the Fund at that time.
Can I use my IRA, 401K, or other qualified funds to invest?
Many IRAs and SEPs allow funds to be directed to Stallion. Unfortunately, we are not able to accept 401k investments or other pension vehicles. We work closely with several custodians that can accommodate your specific needs.
Is it possible to withdraw my investment?
There is an 18 month commitment period. After the commitment period is fulfilled, funds can be withdrawn at the end of the next quarter.
How do I keep up to date with my investment?
Investors are sent a statement after each quarter detailing the performance of their investment. They can also monitor their investment through our online portal.