The differences between investing in trust deeds versus the stock market.
Today I’m discussing the differences between investing in the stock market and trust deeds. Which one is the better investment?
When you invest in trust deeds, you’re investing on the debt side of real estate. By doing so, you’re creating a consistent monthly cash flow that’s paid to you from the borrowers in the form of interest payments. Additionally, you are protected from fluctuations in the value of the underlying real estate because your investment is fixed. Generally speaking, you’re at a maximum loan-to-value ratio of 65% of the value of the underlying collateral.
Put a different way, if there are fluctuations in the value of the real estate, that doesn’t affect the value of your underlying investment. The protection of your investment is the best thing about investing in trust deeds.
That’s very different from investing in stocks and bonds. The stocks and bonds markets are always moving up and down, so when you invest in them and there are valuation fluctuations in your underlying portfolio, you can gain or lose money extremely quickly.
Investing in trust deeds also allows you to diversifies some of your investment money outside of the stock market. They can move some of that money away from the stock market and have it insulated against a potential crash. Many of my investors don’t trust the stock market, which is another reason they like trust deeds; they’re transparent, and you get consistent cash flow.
If you want to learn more about investing in trust deeds, I would love to speak with you, share more of my insights, and answer any questions you have. Call me or visit my website at any time. I hope to hear from you soon.
NMLS ID: 307420
**BRE: 01191560 **