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Frequently Asked Questions (FAQs)

What are the loan terms?
Our ideal arrangement is an interest-only loan for five years, with repayment of the entire principal at the end of the five-year period. For example, an investment of $15,000 at 8% return for five years would generate five annual payments of $1,200 each, plus repayment of the $15,000 at the end of the five-year period.

What are the requirements to become a lender?

Lenders must be United States citizens or resident aliens.   

What are the minimum and maximum loan amounts?
We are currently limiting lenders to a minimum of $15,000 and a maximum of $100,000 per transaction. 

Who is the Borrower?

The Borrower is Shamrock & Spice, LLC, a Maryland limited liability company owned by Erin and Parvez Lokhandwala.  Erin and Parvez will issue a Personal Guarantee with each loan. 

What does “Personal Guarantee” mean? 
"Personal Guarantee," in simple terms, means that if Shamrock & Spice, LLC becomes unable to repay the debt, Erin and Parvez Lokhandwala will assume personal responsibility for the balance. 

How will my money be used?

We will use the funds to expand our portfolio of high-quality residential rental properties.  

What happens to the loan if Shamrock & Spice, LLC goes out of business?

If Shamrock & Spice, LLC were to go out of business, the loan would still be backed by the Personal Guarantee of Erin and Parvez Lokhandwala.

May I see a sample of the Promissory Note?  
Of course, please contact us with your email address, and we will share a sample Promissory Note. 


Are there any additional costs associated with the loan?
There are no extra or hidden loan costs. 


Who prepares the Promissory Note and Personal Guarantee? 
Erin Lokhandwala, Esq. will prepare the documents. 


May Lenders request repayment of the loan before the term ends?
We only offer fixed-term loan options. Once we use the loan funds to purchase additional investment properties, it will be locked. If a lender expresses a desire to pull out the money, we will do our best to repay the full loan amount as soon as we have funds available. However, we do not guarantee the return of principal until the end of the loan term. Please only lend to us if you agree with the loan terms. 


What happens if the Borrower repays the full loan amount early?
There is no penalty for early repayment. 

How are loan payments issued?
Our general practice is to make loan payments by check. However, we can also make payments via direct bank transfer, at lenders’ request. Banks might charge small fees for direct transfers. 


Does the Promissory Note allow a grace period before a payment is considered late? 
Our standard Promissory Note allows for a fifteen-day grace period for both the interest and principal. 


What happens in the event of a nonpayment? 
We have every intention of repaying our loans on time. However, in the unlikely event of nonpayment, the lender has the option of filing suit against the Borrower for recovery. 

Will lenders receive their principal investment back even if the real estate market declines?  
Yes. We plan on keeping our properties as long-tern rental investments. We don’t do fix-and-flips or other high-risk transactions. Any market downturn would not affect our plans to keep and rent our current investment properties, and certainly would not impact our commitment to lenders. 

Does a loan entitle the lender to a stake in Shamrock & Spice, LLC?

A loan does not entitle the lender to a stake in Shamrock & Spice, LLC. As such, lenders may not participate in the management of the company. 

Is the loan interest taxable?
Yes, the annual loan interest is taxable. Earnings will be taxed in the same manner as the interest earned from money in a bank savings account. Generally, for most lenders, this income will be taxed in the same manner as interest earned from banks. Please ask your tax consultant how the investment will impact your taxes.

What tax-related documents will you generate for lenders?  
We will generate a 1099-INT form for lenders (similar to those issued by banks) annually during tax season. 

How will you keep my personal information safe? 

We don’t collect any personal information at the outset; however, at tax time we can discuss what is required to generate the 1099-INT form and how to securely provide that information. 

How can prospective lenders connect with you to discuss further details? 

We are happy to meet via phone or video chat. Contact us to set up a meeting. 

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