Do you need an angel investor to help with a downpayment on your home?

Some angel investors do invest in real estate.  But if you are looking for an angel investor to provide a downpayment for your own private home, you will have a difficult time finding one.  However, if you are seeking an angel investor for a residential home downpayment in a residential home real estate business, you may find an angel to be exactly what you need. 

What is an angel investor?

An angel investor is a wealthy individual that invests his own private money in early stage businesses.  Many times an angel investor is a successful exited entrepreneur or retired businessman.  The amount in a typical deal varies by investor from $10,000 to over $500,000.  Most times an angel investor will invest a similar amount in each deal.

 How to get a Downpayment for a Home from an Angel Investor

 Most angel investors have plenty of deal flow.  In fact, in order to focus their attention on the best deals they need criteria for considering a business plan.  Typically an angel investor will choose a company that is close geographically in an industry that the investor has experience.  Angels know that usually entrepreneurs need their advice and contacts as much as their money.  Being close makes it easier for the angel to provide both.

 Most angel investors prefer early stage deals.  They realize that investing in startup companies is high risk, but there is also potential for high returns.  In a real estate company you may need recurring, ongoing downpayments for homes.  To find an angel investor who is willing to provide that funding may be a matter of discovering the motivation of the angel.

 What motivates an angel investor to fund a home downpayment?

 Some investors have money to invest in homes, but not the time to find deals.  You need to find an investor like this so you can provide your solution.  If you have no previous real estate experience, try becoming a real estate agent or getting some experience in the field first.  Deals are based on trust, and if you do not know the potential angel investor well, you will need credentials to help build trust.

 Where can I find an angel investor?

 Most angel investors fund entrepreneurs they know or were referred to by a trusted source.  Thus the key to getting funding is to know the right people.  Start by asking those you know for referrals to potential investors.  If you need more angel investors, try contacting your local chamber of commerce, real estate groups, and local real estate agents.  Local professionals like attorneys, accountants, and bankers may also be able to refer you to an angel investor.

If you prefer to use the internet to help find angel investors, www.Invstor.com is an excellent resource.  The Invstor.com Network connects advisors, job seekers, investors, entrepreneurs, service providers, and others in the startup business community. 

How can The Invstor.com Network help me find an angel investor for my home downpayment?

First, you can sign up for a subscription.  A subscription allows you to view the contact information for all Invstor.com members.  You can do a search for investors by state, preferred investment amount, and industry, or any combination of the three.  When you find an angel investor that is well fit to your business, you can contact them and begin discussing your opportunity. 

You can also post a “Request” which gets broadcast to investors on the network specifically seeking deals similar to yours.  A Request is similar to a classified advertisement.  When an angel sees your opportunity, s/he can contact you if interested. 

Finally, you can become a member for free and put your business information in your profile.  Investors will be able to find your business when they are browsing for new opportunities, and you may be able to find funding this way.  It is the least aggressive way to find funding, and thus it will most likely require the longest time.