How FREEDOM Handles Risk

I wanna talk about risk today because I think this is the most important conversation you can have before you invest anywhere, including with us. And I wanna be really honest with you up front. Real risk is not something you can eliminate. Anyone who tells you there's zero risk is not telling you the truth. And that alone should make you stop and ask more questions. What matters is how is risk being managed? And who's standing behind the decision when something goes wrong. So let's start with the structural protections. FreedomNotes are secured by real estate assets, multiple properties, not one. Each loan is cross-collateralized, meaning multiple properties back each other. So if one property underperforms, the others provide additional security behind your note. That is a meaningful layer of protection that most individual real estate deals just don't offer. We also maintain LTV requirements. That's loan to value. It's the ratio of how much we owe compared to what the property is worth. We don't borrow against 100% of a property's value. There's always a cushion between our debt and our equity, and that cushion protects investors if values shift. We invest in needs-based assets. That's workforce housing, senior housing, self-storage, because demand for these is structural, not cyclical. People don't stop needing housing when the market gets hard. People don't stop aging. People don't stop needing storage during life transitions. That asset selection is a risk decision, not just a return decision. And we manage our own properties. I want to say that again because it matters. We manage our own properties. We are not dependent on a third-party management company to prioritize your returns. We built our internal property management team because we got burned by outside vendors early on, and we're never going to let that be a vulnerability for our investors again. Now, and this is the part I think is most important, the real risk question is not about structure at all. It's what does this team do when something actually goes wrong? Because in 18 years of real estate, something will go wrong. Markets shift, contractors fail, operations gets hard. The question is, what do you do when you face adversity? So let me tell you a real story. We had a contractor fraud on one of our properties. That contractor submitted fake invoices, fake photos, fake progress reports. And by the time we figured out what was happening, we had paid for a renovation that didn't even exist. We're talking tens of thousands of dollars, and that fraud was real, and the loss was real. And here's the decision point. Flip and I absorbed that loss personally. We went out and paid for the real renovation again out of our own funds, and we honored every commitment we had made to investors on that property throughout. Not one investor lost a dollar. Not one investor missed a payment. Why? Because our investors come first. That's not something I just say in a video. That's a decision I made a long time ago. And every decision we've made in 18 years has been consistent with it. There is not a point in time ever to date that we've not paid our investors exactly what was owed them. Not one. In good markets, in 2008 when the financial crisis hit, in 2020 when the pandemic hit. Every investor, every dollar, every time. And I want to say something about what we do when things are hard. We don't go quiet. If a property is facing headwinds, vacancy spikes, a tough refinancing environment, an unexpected expense, we communicate proactively. That's the standard we have held for 18 years. One of our team members who's been with us for years and is also an investor herself says it this way: We've paid people when we didn't make money, and we've never defaulted on a loan. That's the culture. So when you're thinking about risk, I want you to think about two things: the structure, which we've built very deliberately over 18 years to protect you, and the character, which you can verify through our track record, through our investor references, and through conversations with Flip and me directly. In one of our next videos, we share our 18-year track record in detail, and we tell you exactly how to verify it yourself. So you don't have to take our word for it. If you have questions about risk, specific ones, hard ones, please feel free to reach out. Go to chatwithfreedom.com and let's talk through it. We'll answer. We always do. I hope this was helpful, and I hope we have the opportunity to work together.