Frequently Asked Questions
FAQ Investors
What is Brelion?
Brelion is an online platform that connects investors with real estate developers who are looking for loans.
How does Brelion.com work?
Accredited investors can invest in pre-vetted real estate investments on Brelion.com by creating an account, undergoing accreditation, and pledging an investment of their choice.
If a deal achieves full-funding, investors receive interest from the deal on a monthly basis. The deal closes when the developer exits and the principle from the project is paid to the crowd.
Why should I invest in real estate?
Accredited investors can invest in pre-vetted real estate investments on Brelion.com by creating an account, undergoing accreditation, and pledging an investment of their choice.
How do investors benefit from Brelion.com?
Investors benefit from potential high returns on a wide range of debt, equity, and mezzanine real estate investments, lower investment minimums than competitor platforms, and the opportunity for enhanced diversification of portfolios.
How do I get started as an investor on Brelion.com?
You can get started as an investor on Brelion.com by signing up and getting accredited. We ask you to provide specific information pertaining to your eligibility and integrity as an investor. All investments and transactions are conducted online.
Are there fees to join?
No. Brelion only charges fees on the investments themselves.
Can anyone invest?
No, only “accredited investors” can participate right now. That might change in the future.
Am I an accredited investor?
In general, a person is an “accredited investor” if she (i) earns at least $200,000 per year, or $300,000 per year with her husband; or (ii) has a net worth of at least $1 million, excluding her principal residence. For the SEC’s full definition, please visit http://www.sec.gov/answers/accred.htm.
How do I show I am an accredited investor?
Brelion uses your documentation and financial history to verify your status as an accredited investor.
What if I’m not an accredited investor?
You can still sign up and see the investments, but you cannot yet invest.
I just joined the site as an unaccredited investor. Why can’t I see any investments?
Due to SEC regulations, details of offerings on Brelion.com are currently only available to accredited investors.
Even if unaccredited, we encourage you to sign up on our site to receive relevant updates on real estate investment and crowdfunding, as well as changes to our platform.
What types of investments will I see on Brelion?
We intend to list primarily non-owner occupied residential as well as small to mid-size apartments/commercial projects.
What is the difference between debt and equity financing?
With debt financing, you invest in a developer’s project with the understanding that your money will be paid back with interest, usually on a periodic basis.
With equity financing, your investment purchases a percentage of a developer’s project. You won’t receive periodic payments, but you share in the profits that the project yields.
Do you do any due diligence before listing investments?
Yes. We perform due diligence on individual projects and on the developer itself. However, due diligence is as much an art as a science, and we cannot be 100% certain that our due diligence process has uncovered all relevant information.
Can I do my own due diligence?
Yes, and we strongly encourage you to do so. We will post a substantial amount of information about the deals and the developers. If you think you need more information, feel free to ask us.
Does Brelion recommend investments?
No. While Brelion provides investors with information on deals, properties, and developers, our platform does not make recommendations on individual investments. An investor must come to their own decision on investing in any particular deal. If you’re not sure, you should consult with your own financial and investment advisors.
How should I choose among all the projects on the site?
Brelion provides some educational material, including blog posts on different types of projects. But we are not allowed to provide investment advice.
How much should I invest?
That’s entirely up to you and your investment advisors. As a general matter, most people recommend a balanced portfolio that includes both low-risk and high-risk investments, with the right mix based on lots of factors including your age and your own tolerance for market fluctuations. As you consider how much to invest, you should think of the projects on our site as high-risk investments.
What is the minimum I can invest?
The minimum investment is $1,000.
Should I invest all my money in one investment?
Investment professionals believe it is best to diversify your portfolio as much as possible.
What happens if a deal is oversubscribed?
We work on a first-come-first-served basis. Once we have received commitments for the full amount of an investment, it is closed to further investors.
How risky are these investments?
You should view these as very risky investments—much riskier than an investment in a stock market index fund, for example. The same is true for any direct investment in real estate. You could lose some or all of your money in any of these investments.
Are any of the deals guaranteed?
No. We cannot guarantee that investors will receive the anticipated return, or even that they will get their money back.
The real estate market crashed in 2007-8. Could that happen again?
Yes. Real estate can be a volatile investment and you should be prepared for ups and downs.
What happens if a developer defaults on payments?
In the case of a developer default, our sister company Smartland can subsume a project to minimize losses for the crowd.
If I invest in a project, do I become personally liable for anything?
No, not at all. You are only personally liable to make your investment. We choose our legal structures to protect investors from personal liability.
What happens if enough money isn’t raised to fund a project?
If enough money isn’t raised to fund a project, funds that have pledged by investors for this project will be returned.
Can I rescind my pledge or back out of project before the deadline?
Yes. You can back out of an offering up to 48 hours before its deadline. If there is a material change to the offering or to the information provided by the developer, then all your previous investment commitments will be automatically cancelled unless you reconfirm them.
Will I have to pay any fees on my investments?
Yes. Brelion charges investors 1% of the interest raised on deals.
Where are your projects located?
Brelion conducts deals on local, national, and international levels, from Northeast Ohio to the East and West coasts, and abroad.
Do you fund international projects?
Yes. We are currently forging relationships with international developers.
Do you allow international investors?
Yes, as long as you invest through US entities. Please contact us for more information if you are an international investor.
How long is the investment period?
Brelion conducts deals from 12-24 months on average, although we cannot guarantee any specific length of time for a deal.
How do investors transfer funds to Brelion.com?
Brelion oversees ACH transfers from an investor's bank account to an escrow account, where funds are held for the duration of the deal.
How are payments distributed to investors?
Crowd investors set up bank account information on Brelion.com and receive interest payments from developers each month after a deal is funded. Distributions are sent to investors on a quarterly basis. The principle on any deal is paid to investors when a project is completed and the developer exits.
How often are distributions sent to investors?
Distributions are sent to investors on a quarterly basis.
Will I be notified of how my investment is performing?
Yes, you will be notified on a monthly basis on the performance of projects you have invested in.
How can investors track their performance?
Investors can track their deals on their Brelion profile. Developers also send investors monthly updates on deals.
Additionally, investors receive monthly updates from Brelion via phone or email on project progress, revenue data, and other platform interests. More info can be provided upon request.
Will the owners of Brelion invest alongside other investors?
Absolutely! Brelion’s founders/owners envisioned a platform that connects real estate companies seeking capital for projects with investors looking for lucrative investment opportunities. Our owners plan to take advantage of these opportunities and invest in projects alongside other investors.
FAQ Developers
What is Brelion?
Brelion is an online platform that connects real estate developers seeking financing for residential and small-to-midsize commercial projects with accredited investors.
How does Brelion.com work?
Developers on Brelion.com can obtain residential or commercial loans by filling out an online application, having their deal request(s) approved, and awaiting funding through the crowd.
How do developers benefit from Brelion.com?
Brelion helps developers gain fast and fluid access to cash for residential and commercial projects, with financial stability on transactions and a strong infrastructure for communicating/reporting to crowd investors. Our methodology is more efficient and less bureaucratic than financing performed by traditional banks or private lenders.
What types of financing does Brelion provide?
Brelion provides debt, equity, and mezzanine financing. Our loans are secured by real estate on a preferred return basis, in which developers start paying interest on their project financing after thirty days, regardless of how much progress has been made on the project.
What is the difference between debt and equity financing?
With debt financing, investors pledge funds toward your project with the understanding that you will pay their money back with interest, usually on a periodic basis.
With equity financing, an investor essentially purchases a percentage of your project. You do not make periodic payments, but you share your profits from the project with the investor.
How do I start raising deals on Brelion.com?
Visit this page to submit a form for the project(s) you want funded. After you submit, our team reviews information on the property, the desired loan, and your history as a developer. Our account manager then contacts you with a further explanation of the process and pre-vetting.
If you pass our pre-vetting stage, our underwriter then assesses your submission for the 5Cs: Character, Collateral, Condition, Capacity, and Capital. If our underwriter approves the 5Cs, you receive a notification of acceptance, and your deal is listed on our platform.
How fast can a project be raised?
Brelion cannot guarantee that money will be raised for a project; however, we will try to raise funds within 7-10 business days.
Where does the money to make the loans come from?
Brelion has an ever-expanding crowd of investors who are eager to fund real estate projects listed on Brelion.com.
How does Brelion structure its deals?
Brelion is organized as a main-LLC, under which each project is recognized as a single-purpose LLC. Investor funds are held within the single-purpose LLC. The single-purpose LLC holds the title to its own project, while developers are responsible for conducting all project work.
How do I pay my loan?
You pay monthly interest on your loan while it is outstanding. The principal is paid in full after the project is completed.
What terms does Brelion offer?
After funds are raised, Brelion collects an administrative fee and a listing fee from the developer, wiring funds from the single-purpose entity to the developer. Developers are also responsible for a 1-2% loan servicing fee.
How much equity do sponsors need to commit to a project?
Developers are required to bring a minimum of 20% of equity to a project.
How often are distributions sent to Brelion investors?
Developers pay interest on a monthly basis. Distributions are made quarterly, and the principal is paid off at the exit.