We cover many interesting topics during our events and webinars, but sometimes there are deeper questions that merit digging into, and we thought it would be helpful to create a list of the most frequently asked questions that investors pose to us, along with expanded narratives to provide additional context and detail.
Q: What kinds of real estate investments does the Lucky Fund make?
A: The Lucky Group invests in single family homes by creating non-traditional loan solutions for underserved borrowers. By bridging the gap to this massively underserved consumer majority, we’re able to leverage investor funds to originate owner financed notes which allow for the borrower to purchase and occupy their home.
Q: Who can invest in the Fund?
A: The fund is registered as a 506(c) investment and is available to accredited investors only.
Q: How will I manage my investment?
A: All transactions, signatures, reporting, and quarterly distributions are handled through our secure investor portal. This ensures that sensitive investment information and documentation is held in the highest regard.
Q: How much should I expect to receive in distributions?
A: After participating in the fund for one year, investors will begin receiving a 10% preferred distribution (annual, paid quarterly). Preferred distributions are securely processed via ACH at the end of the month following the close of the business quarter.
Q: When Can I Access My Funds?
A: The term of the fund is open-ended, and investors may make withdrawal requests for their Interests after their third anniversary as a Limited Partner*.
*subject to conditions. Consult the PPM for further details
Q: What is the Fund’s investment philosophy and investment strategy?
A: The Fund’s investment philosophy is centered on the core belief that it’s better to be roughly right than precisely wrong. Meaning we acknowledge inherent risks in investing that cannot be accounted for, and instead of optimizing every dollar we focus on maintaining a margin of safety. This philosophy focuses our attention on management of leverage, credit risk, and operational efficiency.
The cornerstone of our investment strategy is our ability to capitalize on our unique origination process, and our ability to source and negotiate owner finance notes directly with qualified borrowers who are unable to secure conventional home loans while also protecting investor capital through disciplined underwriting and innovative deal structuring. By targeting underserved markets and leveraging our expertise in real estate and portfolio management, we aim to generate consistent, high returns while maintaining a strong focus on downside protection.
Q: How do you qualify borrowers?
A: We start with people—not properties. Through our fully integrated vertical, we source credit-conscious, self-employed buyers with strong income, savings, and a consistent payment history. To ensure the quality and reliability of our mortgage assets, we require each borrower to undergo a fully compliant and structured underwriting process, and all residential properties must meet our underwriting criteria. This process helps us secure our assets in the event of default and select only those borrowers who demonstrate a strong ability to repay, thereby reducing credit risk and ensuring a stable income stream for the Fund.
Once a buyer is approved, we help them find a home that meets both their needs and our underwriting standards—eliminating speculation and minimizing risk.
Q: How does the Lucky Group make money?
A: After providing financing to the Buyers, the Fund holds mortgage assets on its balance sheet that it can utilize in a few different ways. The Fund can sell those mortgages to institutional investors, it can hold those assets for investment, or it can take margin against those assets to utilize in future transactions. Each option comes with benefits and tradeoffs. We manage our portfolio according to our investment philosophy – focusing on minimizing the cost of capital and exposure to credit risk.
Q: Are there tax write-offs?
A: Investors will receive a K1 by March 31 of every relevant tax year. Given that The Lucky Fund originates notes around single family residences, investors may be able to participate in the depreciation that is commensurate with the tax filing of those assets. Investors should consult their tax consultant to confirm how the investment’s tax filing status is relevant to their investment entity.
Q: How will I be updated on the performance of my investment?
A: We prepare and distribute electronically, on at least a quarterly basis, unaudited investor statements reflecting your Capital Account and your Preferred Return. You will also receive, or be provided with electronic access to, annual financial statements and reports. Financial and other valuable information regarding us will routinely be accessible through, and posted on, our third-party fund administrator’s online portal or distributed via email.
Q: What competitive strengths does the Lucky Group provide to the Fund?
A: The General Partner, The Lucky Group, brings a differentiated blend of deep domain expertise, technology-led operations, and forward-thinking investment strategy, positioning the Fund as a market leader in modern mortgage origination. This unique foundation enables us to deliver compelling returns while solving structural inefficiencies in the mortgage industry.
Q: Can I invest using my retirement account?
A: Yes! We can accept funds from retirement accounts, provided that the funds are held at a self-directed custodian or trust company.
Click the link below to request access to our investor portal, and learn more about The Lucky Fund!
Click here to learn more about The Lucky Fund!
