The following disclaimer text is specifically designed to seem as scary as possible, so that you are fully aware of the possible “down side” to investing. The “up side” will take care of itself.

Risk Management

Sometimes, you can make no mistake and still lose. That’s called “Real Life“. Life is all about managing risk, not hiding from it.

Real Cash Flow Advisors LLC (RCFA) offers to our clients the opportunity to invest in 1st and 2nd lien trust deed debt instruments that are secured by real property. The 1st and 2nd lien trust deed debt instrument investments that RCFA offers are not insured or guaranteed by the U.S. Government, the FDIC or any banking or financial institution. The investments are privately offered only to accredited investors and qualified sophisticated investors.

Our management Power Team always attempts to circumvent and minimize the “down side” of investments that turn bad. It’s just that sometimes an investment will turn so bad that the only viable choice is to initiate a foreclosure action in an attempt to sell the property or to acquire ownership of the property.

Your only recourse in the event of default is the underlying secured real property. RCFA cannot and will not guarantee any return on your investment nor any return of your investment. Your investment is secured only by the underlying real property through the foreclosure process as defined by operation of law. In the event of default, you may need to retain legal representation of an attorney to protect your interest in the real property.

Your agreement to lend money to us to invest in notes, or to provide equity financing to buy non-performing notes (NPN), is expressly subject to you agreeing to release fully any and all of our liability in the transaction in exchange for us conveying to you the lien trust deed (security instrument) and the promissory note signed by the borrower (that’s called a “hypothecation agreement“). In that event, our promissory note to you will terminate and your sole recourse is pursuing recovery of your investment through the commercial borrower’s promissory note and security instrument.

Although losing all of the principal investment through investing in 1st and 2nd lien trust deed debt instruments is highly improbable, it is possible. Please understand the possibility to have interruptions or bad variations in cash flow, as well as extension requests by borrowers needing more time to pay-off their notes, or needing co-operation in recasting the debt to avoid default, or needing additional funding to realize the full potential of the repositioned property. RCFA will provide assistance in negotiating and managing these risks while we are involved in the transaction.  We will not subsidize that cash flow from other income streams. If we are released from the transaction through the hypothecation agreement, then you may retain the services of anyone else to handle the disposition of the real property.

In some improbable situations, acquiring ownership of the real property through a foreclosure action (or a “deed in lieu of foreclosure”) may expose you to additional liability, for which there may be inadequate insurance, or possibly any insurance would be unavailable or impractical. RCFA exercises due diligence to understand, to manage, and to mitigate such risks, but we can never eliminate all risk. Such risks may include mold or chemical contamination, expansive or contaminated soil, personal injury (“slip and fall”) to tenants or visitors, improper or defective repairs, code violations, condemnation proceedings (e.g., “eminent domain” taking of the property), force majeure, natural disasters, delinquent property taxes or other kinds of government assessments against the property, etc.

Also, no investment is completely risk free and past performance is not a guarantee of future results. Each investment stands on its own merits and the results are subject to market forces. Additionally, interest income on the trust deeds is not guaranteed.

Our affiliate company, Smith Syndication of Verity Investments LLC, specializes in repositioning and stabilizing distressed income properties. Some of the 1st lien trust deed investments that we may offer to you may involve Smith Syndication as the commercial borrower with disclosure to you, and thus RCFA would have an implied interest in approving and funding that transaction through your investment funds.

The information presented on the RCFA website is general in nature without consideration of your financial situation or your investment objectives, and we are not making recommendations based on your personal situation. The suggested investment strategies may be inappropriate for your situation. You are strongly encouraged to retain the services of a qualified professional to advise you on the merits of each opportunity. Only you are responsible for your decisions. We believe the information provided is reliable, but RCFA does not guarantee its accuracy, timeliness, or completeness. You should consider RCFA as a “start up” company with only managerial experience and expertise, and no assets.


You can download the most recent revision of this disclaimer by clicking here.