INVESTORS BEWARE!!! The first and last 60/40 JV deal I closed with this company (see below) settled on 10/28, Monday morning. It's now Saturday afternoon, 11/2, and I still haven't received my money (over $25K). An amount sent via email in a spreadsheet, 2 days after the date we agreed I would receive payment, was equal to 12% of the net profits…
Vastly different from the 60% split I was anticipating after rehabbing, managing and selling the property…This calculation included doubled the closing costs, recouping revenue and expenses that were already subtracted from the HUD/CD.
Prior to closing, I had a feeling Sean Richway, the president of this company, would do this. So, I asked to be paid at closing. That was denied with all types of excuses. My wire instructions were sent without the company's request, which was questionable.
Responses from Sean prior to receiving the settlement money were within the hour. Now, that Sean is in receipt of the closing funds, responses take 24 hours…Before experiencing this very unprofessional way of handling business – I knew there wouldn't be a second time at bat with Sean and this company given the persuasion of becoming the buyer instead of the lender, and the 3% monthly management fee outlined in the JV agreement.
This clause is a very sneaky way to turn his 40% split to upwards of 50%. Sean, when discussing this transaction at least, did not manage the subject property in any aspect. Yet, he stands to generate $37K in management fees. Roughly, 1/3 of the net proceeds…That's a straight rip off!
The money I've earned should have been wired at this point, period. Any amounts in question north of this payment, could be hashed out and negotiated at a later date. If I do not receive payment Monday, a full week after closing – I will be contacting the authorities and taken appropriate action to receive payment.
Hopefully, I've saved a few people from dealing with Sean, Infinity Capital Finance, its affiliates and this drama…Real estate is too fun and profitable to deal with such an individual that makes partnering dreadful and holds someone else's profit illegally. Fellow investors, BEWARE!!!
Sean Richway, President Infinity Capital Finance Cell: 443-528-9699 [email protected] [email protected] www.infinitycapitalfinance.com