Choose Your Real Estate Investing Club Members Wisely
Although I definitely recommend that anyone who is interested in forming one of these groups do it, there are a few things that must be considered and accounted for before doing so, although I definitely recommend that anyone who is interested in forming one of these groups do so. Don’t forget that an investment property club can be a very exciting social event, that you would ever put together. Groups like this not only give you and your friends a chance to get together, it also gives the members the opportunity to learn how to buy property, share knowledge and make new contacts within real estate investing.
A primary concern for your club is the people you ask in to join. You must absolutely be sure to get only people who are serious about the investment club, and that they can get along with one another. If you have friends who do not seem to be able to get along together, by all means block one of them out of the invitations to join. If you begin your club with just one agitator, it will be enough to destroy the group, so be very picky in recruiting your group members.
Once you have your members, let them all have a voice in the creation of your groups operating agreement. This way, everyone will have a say right from the beginning and nothing should be said about how things will be run at a later date. Take care of things like the rules, meeting place and the contribution amount, and have everyone in agreement. Then give everyone a copy of the agreement before they leave.
Let the members know that the money they agree to put in each month is money they very well may lose, and that they acknowledge this fact. Put it in writing also that each member agrees to being informed that the investment club may not be profitable for a few years and have them acknowledge it in writing. For some reason, some people believe that they will be making money immediately, and when they lose it instead, they get angry at the group. A signed letter of acknowledgement gets this problem out of the way from the very start.
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With everyone working together, it can’t be anything less than pleasurable. Work together as a whole to learn and understand real estate investing and how to pick a winning property. Investment clubs can be a positive experience if you and your group members stay organized with all of your paperwork. Make sure you divide the work up and remember that you are a team.
