Table of Contents
2. How Do You Prove You Are an Accredited Investor?
3. What is an Accredited Investor Letter?
4. Why Accredited Investors Should Consider Multifamily Syndication
5. Why Accredited Investors Should Consider Multifamily Syndication
6. Why Invest with BAM Capital for Multifamily Real Estate Investing
7. BAM Multifamily Growth & Income Fund IV
Accredited investors are able to invest in securities that are not registered with the US Securities and Exchange Commission (SEC). This means they can have legal access to investment opportunities that are not available to the general public such as hedge funds, private equity deals, venture capital funds, angel investing, equity crowdfunding, and other private placements.
Having the accredited status is beneficial because it gives you more investment options through unregistered securities. This allows accredited investors to make smarter financial decisions. On the other hand, regular investors need to stick with securities like stocks, bonds, and mutual funds.
There is a reason these securities are limited by the SEC, however. Unregistered securities tend to have a higher risk associated with them, but they are also potentially lucrative. Therefore the SEC limits access to them in order to protect investors who do not have the financial safety net and sophistication to recover in case the investments do not work out.
Accredited investors are able to quickly bounce back from riskier investments due to their higher net worth and income. Having the accredited status also comes with the expectation that the investor has enough investment knowledge and experience to know what they are doing. Accredited investors are able to assess the risk and make intelligent investment decisions.
However, before you are able to participate in these securities, you first have to prove that you are an accredited investor. Investors who want to participate in exclusive investment opportunities have to go through a verification process that determines their accredited status.
What is an Accredited Investor?
Accredited investors meet certain financial or professional criteria that are set by the SEC. If you can meet certain wealth and income thresholds, then you may be classified as an accredited investor.
The first way to determine accredited status is by using net worth verification. An individual who has a net worth that exceeds $1 million either alone or jointly with their spouse is considered an accredited investor. Keep in mind that the net worth calculation has to exclude the person’s primary residence. 
Annual income level can also be used to determine accredited status. Anyone with an annual income over $200,000 in each of the prior two years, with a reasonable expectation of having the same level of income for the current year qualifies as an accredited investor. This can also be achieved with your spouse, as long as you have a joint income of $300,000.
The net worth and income tests are the two main ways to determine one’s accredited status. But some professionals also qualify because of their credentials and investment knowledge. For example, an accredited investor may also be an investment professional who is in good standing and holding specific licenses.
Individuals holding the following licenses are considered accredited investors: general securities representative license (Series 7), investment adviser representative license (Series 65), and the private securities offerings representative license (Series 82). 
Knowledgeable employees of a private fund also qualify as accredited investors. The same goes for executive officers, directors, and general partners of the company selling the securities.
Even entities can become accredited investors if they meet certain criteria. Entities with investments in excess of $5 million, such as corporations, partnerships, trusts, and limited liability companies (LLCs) are accredited. Any entity wherein all equity owners qualify as accredited investors is also considered accredited.
How Do You Prove You Are an Accredited Investor?
If you want to be an accredited investor, you have to find a way to prove that you qualify as one. However, what most investors do not know is that there is actually no specific accreditation process in order to become an accredited investor. If you meet the requirements set by the SEC, then you automatically qualify as an accredited investor.
The burden of having to prove that you are accredited does not fall on your shoulders. Instead, the company that is offering the unregistered securities is required by the SEC to verify the accredited investor status of their investors. They will be the ones handling the verification process.
This means every time you want to invest in private equity funds, hedge funds, or syndication deals, you have to prove to the company that you are an accredited investor.
These companies offering unregistered securities will check your accredited investor status. They may ask you to fill in a questionnaire and submit documents that show your financial status. Usually, an investment manager will ask you to submit your tax returns, credit report, bank and brokerage statements, W-2 forms, etc. You may begin investing once they have confirmed your status.
The firm that manages the unregistered fund may put you through their own screening process before they can decide if you are legally allowed to invest or not.
Your net worth is calculated by adding all your assets and then subtracting all your liabilities, including debt. For accredited investors, the primary residence needs to be excluded from the net worth calculation. This means that mortgages and other loans are also not counted as liabilities. 
You simply need a net worth that exceeds $1 million, either individually or jointly with your spouse or spousal equivalent. Remember that your net worth needs to reach or exceed this threshold at the time of the sale of the securities in order to qualify. They will ask for your financial statements and other documents indicating your earnings.
If you have certain professional certifications, credentials, or designations administered by the Financial Industry Regulatory Authority (FINRA), you will have to show them that as well.
Entities such as banks, brokerage firms, certain trusts, employer-sponsored retirement plans, Registered Investment Advisor (RIA) firms, LLCs, SEC and state-registered investment advisers, rural business investment companies, Indian tribes, governmental bodies, and family offices may be considered accredited investors as long as they meet specific criteria. 
You can start investing in the unregistered security once they have determined your status.
What is an Accredited Investor Letter?
It can be time-consuming to prove that you are an accredited investor every single time you want to invest in an unregistered fund. Most accredited investors go through verification over and over again, and it is a time-consuming and tedious process. Luckily, there is an alternative method that will help you save time if you are participating in a lot of unregistered securities.
An accredited investor verification letter will help you prove your status faster. It simply needs to be from a qualified financial professional.
Going through the verification process repeatedly wastes valuable time for you and the company that is offering the security. However, it is also an essential step because it ensures that everyone participating is currently equipped with the financial resources needed for that particular investment opportunity.
Thanks to Rule 506(c), accredited investors can submit an accredited investor verification letter. Tax attorneys, financial advisors, registered broker dealers, certified public accountants, and registered investment advisors can provide you with this verification letter. 
There is no particular format for this verification letter, but it has to indicate the investor’s accredited status. The letter also needs to indicate that the investor meets the accreditation requirements. The financial professional will also include that qualification the investor meets.
This process of third-party verification saves a lot of time for accredited investors and issuers of unregistered securities as it cuts the verification process a lot shorter. The financial professional assesses the investor ahead of time and gives them the verification letter.
This is valid for 90 days, so keep in mind that this accredited investor verification letter has an expiration date. For those 90 days, you can participate in various investment opportunities without having to gather all your documents and requirements repeatedly.
Why Accredited Investors Should Consider Multifamily Syndication
When people talk about investments for accredited investors, they usually think about hedge funds, venture capitals, and private placements. But accredited investors have access to even more investment opportunities that are exclusive to them, and that includes real estate syndication.
There are plenty of ways to get into real estate investing. You can flip houses or rent out a single family real estate property. You can even get into commercial real estate. But not all of these strategies can be just as lucrative as a syndication deal.
A syndication deal is when multiple investors pool their resources together to purchase a single real estate property. This can be done with almost any type of real estate, but multifamily syndication is the most popular among accredited investors. 
This is because single family properties have the risk of becoming vacant. The fact that there is only one unit to be rented out means that the cash flow is not as strong as you would expect from a multifamily property.
Multifamily properties such as condominiums, duplexes, triplexes, and apartment complexes have more than one unit, which means they can generate a stronger and more consistent cash flow. Multifamily real estate offers a reliable stream of income from monthly rent. Because there are multiple units, you don’t have to worry as much about vacancies.
Generally speaking, multifamily real estate is also more expensive. This makes them harder to obtain for a lone investor. But multifamily syndication deals allow accredited investors to invest in real estate that they otherwise would not be able to. 
In a syndication deal, a syndicator acts as the general partner and puts the deal together. They locate the investment property, secure the financing, and find accredited investors who will provide most of the capital necessary to purchase it. Depending on how the deal is structured, the investors may earn income from the cash flow as well as the equity upon resale. Every syndication deal is different.
Real estate syndication gives you all the usual benefits of real estate investing but without the hassles associated with being a landlord. You wouldn’t have to play this role under a syndication deal. The syndicator handles property management, which means they will take care of emergencies, handle tenants, collect rent, manage repairs, etc. This is a great source of passive income. 
This investment opportunity is not available to a non-accredited investor. It is exclusive to accredited investors because these deals usually last for years at a time, meaning your assets will not be accessible during this time. But it is also a potentially lucrative investment opportunity that generates a strong cash flow.
Look no further than multifamily syndication if you are an accredited investor looking to participate in a passive real estate investment opportunity. Let your money do all the work for you, so you can focus on other business ventures and investments. Grow your wealth through syndication without breaking a sweat.
Multifamily syndication deals are exclusive to accredited investors. If you are interested in multifamily syndication, work with BAM Capital.
Why Invest with BAM Capital for Multifamily Real Estate Investing
BAM Capital is an Indianapolis-based syndicator that prioritizes Class A, A-, and B++ multifamily real estate properties. With a strong Midwest focus, BAM Capital ensures that investors can enjoy a passive real estate investment that will allow them to grow their wealth without having to play the role of landlord.
Multifamily real estate syndication lets you enjoy all the benefits of owning multifamily real estate without the headaches of owning such a large property. With BAM Capital, accredited investors do not have to worry about managing emergencies, collecting rent, dealing with tenants, handling repairs and maintenance, etc.
BAM Capital will negotiate the purchasing and financing of high quality real estate on your behalf. BAM Capital uses an award-winning multifamily investment strategy that creates forced appreciation. 
BAM Capital is also known for their vertical integration strategy that helps mitigate investor risk. In fact, the company now has over $700 million AUM and 5,000+ units. 
If you are an accredited investor and you want to invest in high quality multifamily apartment complexes, BAM Capital may be the best syndicator for you.
Remember that no investment is without risk. Make sure to consult your investment advisor or speak to a BAM Capital investment team member before making any financial decisions. Accredited investors can schedule a call with BAM Capital and invest today.