Real Estate Crowdfunding Terms Scanner

Analyze real estate investment platform terms for liquidity traps, fee stacking, and what happens when you need your money back.

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Real Estate Crowdfunding Provisions I Check First

Your money may be locked up for years with no guaranteed exit. Know the restrictions before investing.

Redemption Restrictions

High Risk

Many platforms limit redemptions to a small percentage quarterly. In market downturns, redemption queues can stretch for years.

Look for: "Redemption limited to 5% of NAV per quarter" or "redemption queue."

Lock-Up Periods

High Risk

Initial lock-ups of 1-5 years are common. Even after lock-up, early redemption penalties can take 1-3% of your investment.

Look for: "Minimum holding period" or "early redemption penalty."

Fee Stacking

High Risk

Multiple layers: asset management (1-2%), acquisition fees (1-2%), disposition fees, property management. Total can exceed 4% annually.

Look for: Asset management fee, acquisition fee, disposition fee, promote/carry.

Valuation Methodology

High Risk

NAV is often based on internal appraisals, not market prices. Actual sale value may be significantly lower than stated NAV.

Look for: "NAV calculated quarterly" or "internal valuation methodology."

Distribution Suspension

Medium Risk

Platforms can suspend distributions during downturns. No legal obligation to continue paying dividends.

Look for: "Distributions at board discretion" or "may suspend distributions."

Sponsor Self-Dealing

Medium Risk

Sponsors may collect fees on affiliated deals, creating conflicts of interest. They win even if investors lose.

Look for: "Affiliated transactions" or "related party dealings."

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