b'How to Legally Raise Private MoneyFor commercial real estate, loan-to-value ratios have diminished and sub-ordinate (mezzanine) debt is not currently acceptable to institutional lenders in first position (those with primary loans), creating the need for a secondary, private source of funding to make up the difference or gap between the pur-chase price for real estate and available institutional financing. Additionally, institutional lenders generally want the borrower to demonstrate skin in the game before they will provide financing. The skin in the game could be your own funds or funds you bring from your investors. Moreover,inrecentyears,newgovernmentregulationssuchasthe DoddFrank Wall Street Reform and Consumer Protection Act (Public Law 111203, H.R. 4173, the Dodd-Frank Act) has established rigid standards on residential borrower qualifications and strict penalties for financial institu-tions or other lenders who dont follow them. The number of single-family residential loans an investor may have and still qualify for a new residen-tial loan has decreased; the reserves an investor must maintain in order to qualify for a new loan on investment property has increased. The bar has been raised with the passage of these regulations. Many people who were previously qualified for loans on residential investment properties are un-able to meet the more rigorous qualifications imposed by the Dodd-Frank Act for such loans. In the wake of the Dodd-Frank Act, institutional loans on single-fam-ily investment properties may not be available. Obtaining institutional financing may not be practical for certain investing strategies, such as short-term fix-and-flips, wholesale deals or certain long-term buy-and-hold strategies, due to timing or other constraints. The 100% financing options (using subordinate debt) of the late 1990s and early 2000s are simply no longer available to real estate investors. THE LEGAL REQUIREMENTS OF RAISING PRIVATE MONEYWhy Would Someone Give You Their Funds?An experienced real estate syndicator will have spent considerable time and money learning a number of real estate acquisition and investment strategies, creative financing techniques and property management skills. Your experience may be learned through a coach or training course, or 4'