NetREIT and United Development Fund

NetREIT and United Development Fund

Postby Rex Reit » Fri May 06, 2011 11:22 am

Those are two of the privat placements my commission-hungry broker convinced me to put my money into. One of the greatest difficulties I have with both of them is to ascertain whether they are run-of-the-mill rip-off companies, being that the "cash dividends" and "interest" are my capital being returned to me, or if the numbers are actual cash, not coming out of my capital.

NetREIT sent me a notice just the other day proudly announcing that it was paying its 48th consecutive quarterlly dividend, which for me amounted to $748 dollars. I have owned 5000 shares of NetREIT for 2.5 years, and the company intends to go public in 2013. Their financials make it very hard to understand where, except from capital, they could be finding the money to pay such cash dividends. Also, I think that if they are able to put together the kind of money it takes to get listed on a major exchange, the price of the stock will immediately plummet. The $748 dividend NetREIT is paying would, by the year 2013, come to about a 30% gain, and then of course I'd have my 5000 shares of the now publicly traded company...

Does that or does that not sound like "pigs flying?"

An officer at United Development Fund assured me that the 9.75% simple yearly interest I'm receiving is not coming from my capital because UDF is in the business of making loans. He said that in 2013 I may be eligible to redeem my entire 50,000 without penalty. Does that sound real? Someone wanted to know why UDF's clients can't find cheaper places to get loans, but I do know that with things the way they are, there could well be clients willing to pay that much interest. The loans are short term--- 12 to 20 months.

Any help/comments would be greatly appreciated.

Thank you.

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Re: NetREIT and United Development Fund

Postby REIT Wrecks » Sun May 22, 2011 4:18 pm


Which UDF fund are you asking about? There are several: United Development Funding II, United Development Funding III, United Development Funding IV, and United Development Funding LP, among others.

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Re: NetREIT and United Development Fund

Postby redsticklarry » Fri May 27, 2011 4:01 pm

Hello, everyone.

I, too, am the woebegone owner of too many UDF3 units, swindled by my broker, who assured me that all would be vested in a mere one year (no doubt grinning from ear to ear while pocketing his 7% commission).

Now three years later, and they have "liquidity problems" for sure; in fact, they just yesterday told my new broker that they were not even paying the promised death redemptions. Prior to that, I had thought that I could at least die and my descendants get the money, but no such luck.

Of course, I do receive my monthly dividend check, at least ever since I first requested redemption, about a year ago. But, the market hasn't been good to me otherwise either, and I need the money now rather than at the maturity date 2 years hence (that last bit presumes that the money will be there then, of course).

I've heard that there are auction brokers out there, who will put up limited partnership holdings like these to selected investors, who bottom pick them, and that broker gets some fees and a relatively small commission. If anyone can direct me to one (or preferably several) of such brokers, I will be in most grateful.

You might even say that I "will owe you one"; you know, similar to my relationship with UDF3?

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Re: NetREIT and United Development Fund

Postby Shareholder71 » Fri Jun 17, 2011 4:27 pm


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Re: NetREIT and United Development Fund

Postby T0153 » Mon Feb 20, 2012 10:07 pm

Help! My mother has United Development Funding III and after reading a little about this, I am concerned about how she can get her money out of it. Can anyone advise on what to do ?

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Re: NetREIT and United Development Fund

Postby blazeminds » Sat Sep 01, 2012 4:34 am

tell about the proper funding There are several: United Development Funding II, United Development Funding III, United Development Funding IV, and United Development Funding LP :geek:

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Re: NetREIT and United Development Fund

Postby peewee » Wed Jan 23, 2013 7:45 pm

Hi, i am interested in knowing if anyone has invested in UDF IV. I am told it pays 8% interest. Your investment is locked in for 5 yours. Kind of like a 5 year CD. if you need to obtain the money prior to end of 5 years then you only receive a portion of the funds pro-rated based on amount of time invested. I am trying to decided if this is a good investment, considering there is no real "safe" place to invest and still receive a decent yield. Any comments are welcome.

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Re: NetREIT and United Development Fund

Postby jamesgaston » Fri Apr 05, 2013 3:57 am

You should ask them the queries you have because the entire process is bit twisted not getting caught. You are not able to make it that how are they going to pay and do settlements at all. When confusions exists, deal couldn't progress well.
settlement payments

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Re: NetREIT and United Development Fund

Postby Dan » Tue Feb 23, 2016 8:34 am

The Peiffer Rosca Wolf law firm’s securities lawyers, Alan Rosca and Joe Peiffer, have been investigating UDF offerings to investors, and are preparing to take action and seek compensation on behalf of UDF investors. The focus of their cases is different from the recent class actions.

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