BiggerPockets

BiggerPockets.com — Dec 22, 2008 — THE ALTERNATIVE TO MARKETABLE SECURITIES

Private Mortgage Lending is the Nuevo thing to do in order to regain or recuperate losses in this volatile investment market. There are important factors to consider when deciding if Private Mortgage Investing is right for you.

Who am I investing with?

- Take time to get to know the company you will trust with your hard earned dollars. Because of the viability of real estate regaining strength and the global ramifications, there is a certain comfort level with investing in real estate right now. There is certain clarity that our country and others will do whatever it takes to improve our currently unstable economy. Thrusting billions into the banking industry, negotiating billions with the "Big Three" car makers, and investing money directly into the small business community will positively impact the banking industry. An infusion of capital will trickle down to the real estate investor resulting in millions of savings in distressed property sale negotiations. This will improve the investor purchase margin. The window of opportunity before the billions of new money objectively out-performs the liquidation of the non-performing assets is short lived. Therefore a company’s performance and track record is vital before assuming, because the industry has perfect timing not every company is equipped to handle the volume and sufficiently manage the portfolio without a plan in place. Choose wisely and do your homework before jumping into bed with just anyone. We are in store for a new wave of lending with returns that will exceed 10% and even 12% as a private mortgage holder.

What's my risk?

- Equity protection is vital to the bloodline of the Private Lenders initial infusion of capital. Address with collateral management company or real estate investor that there is sufficient equity in the property and protected collateral before and after your transaction. Confirm what the maximum LTV will be. Confirm what position you will take as the investor. Understanding the level of capital contribution is a determining factor when facing your place in line as a lien holder.

How do I know it's worth it?

- Address the property value is properly quoted and justified. Property valuation played a powerful role in the implosion of marketable real estate. Marketing properties now with a reduction of marketable value at a record 15%-25% is more difficult and complicated than ever before. A recession with low interest rates and low values is preponderant to historic record. If the recipient,” Collateral Property Manager"/"Real Estate Investor", of the capital contribution is solid and the property has sufficient equity, The returns equating to upwards of 12% are justifiable and achievable. The investors ability to acquire these properties with discounts equating to 50% or more and the 25% margin of equity, further amplifies the residual passive income potential.

What is the investor tolerance?

- There are advantages including increased earnings, manageable liquidity, and increased risk tolerance. There is definitely risk involved and homework for all potential investors. I don't have to mention there are record losses in retirement investments, and marketable securities. I also don't have to mention improving the vitality and resilience of marketable earnings is time consuming. For some this may be the best alternative to recuperating extenuating losses.

Cordially,

Scott Hadfield
Manager, PLP Lender Relations
CTR Development, LLC
Facebook Group “Start Earning 12% Tomorrow”
www.ctrdevplp.com
shadfield@ctrdev.com
w - 618-224-9503
c - 618-531-1780