Fixed returns mean that you know what your annual return on investment is going to be. If you choose a trust deed that earns an 11% rate of return, then you will earn 11% on your principal balance each year, until the loan pays off.
Unlike 90% of other investments, a "trust deed" literally means a mortgage, which is a lien recorded against real estate. If the borrower doesn't pay, then we start foreclosure proceedings. But 98% of all borrowers don't go into default, and the ones that do, usually come out of default.
That's what we like the most about trust deed investing. It's not a black hole. Our investors can do their own investigation, and if you understand real estate, you understand trust deeds. Nothing is hidden from the investor.
Who says big returns have to be risky? If you’re looking for a steady, reliable investment you can actually count on, you’re in the right place.
You’ve heard it your whole life:
“Real estate is the best investment...”
But who wants the headache of taking care of all that property?
Investors often struggle to find a solid investment with a great return. And if you’ve been burned in the past, it’s hard to know whom to trust. How do you figure out WHICH BROKER can teach you about trust deeds, give you the greatest selection of investments and help you make the right choices with your money?
I couldn't trust anyone that would be as diligent as I was, and the early 2000's was the wild west in lending. I'd finally found an investment I could trust, I could understand, and I could control. I didn't have to research companies on the stock market - who weren't telling the whole story anyways.
Back before Zillow, we had to go look at properties and research them on the Assessors website and the Recorders Page.
We knew the sales price, so how much would we lend? If the purchase price was $200k, did we feel comfortable lending $100k? If yes, and if the borrower could prove their income, we made the loan.
Pull credit, get 12 months of bank statements, two years of tax returns, business documents, background checks. This is what the broker does, but the investor has the right to see everything.
Open escrow and request a title insurance policy. Find out who the owner of the property is. View the purchase contract, review the escrow documents, and get a CPL.
Investors have to sign their own set of documents, as well as review the borrower's loan documents.
If you are making a loan, you have to wire the loan amount to escrow, so escrow can close the deal. Once the loan closes, you start collecting interest from day 1.