Finding a great place to invest your money is a difficult task it can be hard to realize decent returns on your capital while keeping your risks at a minimum. With interest rates at a historic low for a number of years, keeping your money in savings or in a CD with the bank will net you next to nothing while the value of your money is hit by inflation. The stock market while carrying the possibility of high returns can also be very risky and you do not actually hold the assets that back any of the securities you purchase. The alternative is with hard money loans. Hard money loans offer high returns and the investment is backed by an asset that has a market value that is higher than your investment.
This type of investment allows you to back the money you invest with a piece of property that carries greater value than amount of your investment. With hard money loans you can choose your investments from a variety of commercial and personal properties. It is also worth noting that your borrower also carries a tremendous stake in making sure your investment comes to fruition, and is motivated to make payments on time. You also get to evaluate the individual or business who is seeking the loan. Hard money loans also generate a return of around 10% give or take a few points.
Reasons to Consider Hard Money Loans As an investment
Self-directed IRAs : You can use your self-directed IRA to invest in hard money loans, allowing you to enjoy tax-free or tax-deferred growth, depending upon the type.
Double-digit returns: Depending upon the type of hard money loan that you choose, you should earn around 10% percent on your investment.
Short-term investment: Annuities and long-term CDs which are generally considered safe, typically keep your money tied up for a long period of time. Typical hard money loans typically carry terms of several months to a few years. Meanwhile, you enjoy the returns on that investment each month in the form of a payment on the loan.
Loan backed by physical assets: Because your money is used to lend and secured by a valuable piece of property, in the worst case, the asset can be sold, often for more than your investment. (These loans are only made on a portion of the fair market value of the residential or commercial property, or other asset).
Control: This is just about the only type of investment that you can make, where you get to pick and choose between investment opportunities. Before you invest your money, you get the chance to learn about the property and the borrower, which makes this one of the most transparent investment deals that you can find.
We do The Work: Alternative Financial Services does the hard work of finding and processing potential real estate borrowers. With 35 of experience valuing and assessing both properties and borrowers, we can bring you solid candidates to invest in. Your borrower is the party that actually manages the real estate. You simply invest, nothing more required, and the high returns on your money, allow you to continue the cycle with new borrowers.