Make Sure You Over-Disclose Compensation

The PPM to me is where you just, not to me, it is the document where you disclose all of the risks, all the reasons, all the ways your deal can go wrong, all the conflicts of interest that you may have, and it’s fine to have conflicts of interest, we just gotta disclose them. It’s okay that you’re buying the house from your brother-in-law, and your brother-in-law’s gonna make a killing, or maybe it’s your own property, and you’re gonna make him killing because you bought it 20 years ago, that’s all fine as long as we’re letting them know, and disclosing everything, especially when it comes to compensation. You wanna disclose, you wanna over-disclose any kind of direct compensation and indirect compensation. Nothing wrong with being a real estate agent, a broker, and you’re gonna get a commission on the sale of that property, and it’s gonna be a nice chunk, that’s fine. Put it in there. It’s okay that you’re also property managing, and you’re gonna make an additional 8% or whatever on the rent, just put it in there. So when it comes to compensation, I think that’s probably the number one risk that we would face is not properly disclosing every single way that you can get things.

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