Private Investment Memorandum
Distressed Houses. California Rentals. Cash Flow From Day One.
We buy single-family homes 30–50% below After-Repair Value, rehab them with our own licensed crew, and rent them out, funded by investors secured with a recorded second deed of trust.
24
Years in CA real estate
700+
Personal home flips (15 yrs)
300+
Homes rehabbed in-house
2004
Loan Director since
How a Distressed House Becomes a Cash-Flowing Rental
Acquire
Put a distressed home under contract 30–50% below its After-Repair Value.
Rehab
Our licensed in-house crew renovates on a fixed budget and timeline, funded by short-term acquisition financing.
Rent
Leased and professionally managed for $100–150/month. The property starts producing positive monthly cash flow.
Refinance
A DSCR cash-out refinance repays your principal and return. The home stays in the portfolio as a long-term rental.
How You're Secured
Your capital is secured by a recorded second deed of trust, not a promise.
- ✓Your investment is recorded against the property's title as a second deed of trust at close of escrow: a real lien, not just a promissory note.
- ✓Combined loan-to-value of the acquisition loan (1st) and your position (2nd) is capped at 85% of property value, a minimum 15% equity cushion behind you.
- ✓Every deal is funded and secured individually: one investor, one property, one recorded note. Your position is never pooled or cross-collateralized with other deals.
- ✓You are repaid, and the note is reconveyed, at the time of the DSCR refinance or sale, whichever comes first.
Capital Stack
1st: Acquisition / rehab loan
2nd: Your investment
Equity cushion: min. 15% (combined 1st + 2nd capped at 85% of property value)
Investor Terms: Two Ways to Earn a Return
Option A
25% Preferred Return
A fixed 25% annualized return. Your original investment plus the full preferred return is paid back first at refinance or sale, before any other party is paid.
Option B
40/60 Profit Share
Your original investment is returned first, then net profit at exit is split 40% to you, 60% to Diamond Real Estate Investing.
Minimum investment: $40,000 per deal. Both options are secured identically by your recorded second deed of trust.
The Life of a Deal: 12 to 18 Months
Month 0
Close & record
Escrow closes; your 2nd deed of trust is recorded against title.
Month 1–4
Rehab
Our licensed crew completes the renovation on budget and on schedule.
Month 4–6
Lease-up
Property manager places a qualified tenant; positive cash flow begins.
Month 6–12
Season
Rental history seasons for DSCR underwriting while cash flow continues.
Month 12–18
Refinance & payoff
DSCR cash-out refinance repays your principal and return in full.
Deal Economics: Real Numbers From Four California Markets
| Market | Purchase | Rehab | All-In | ARV | Rent/mo | Net Cash Flow/mo |
|---|---|---|---|---|---|---|
| Bakersfield | $250,000 | $30,000 | $280,000 | $385,000 | $2,400 | $375 |
| Fresno | $255,000 | $25,000 | $280,000 | $350,000 | $2,100 | $375 |
| Big Bear | $275,000 | $30,000 | $305,000 | $415,000 | $2,900 | $890 |
| Vallejo | $300,000 | $35,000 | $335,000 | $475,000 | $3,200 | $985 |
All-in cost averages ~72% of After-Repair Value. Net cash flow shown after PITI and a $125/month property management fee.
Andy Azadzoi
Founder & Licensed General Contractor, Diamond Real Estate Investing
24 years in California real estate. Loan Director since 2004. Personally led over 700 home flips in the last 15 years, and built the in-house licensed construction team that has now rehabbed more than 300 homes.
andya@diamondinvesting.net · 949-613-0035
4000 MacArthur Blvd, Suite 600 East Tower, Newport Beach, CA 92660
Contact Us Now to Invest
Bring us your questions. We'll walk you through a live deal, the numbers, and exactly how your second deed of trust gets recorded.