5 Reasons Why Trust Deed Investments Belong in Your Investment Portfolio

Building a strong investment portfolio requires a strategic mix of assets. While traditional options like stocks and bonds have their place, savvy investors are increasingly looking to diversify with alternative investments. One such option, Trust Deed Investments, offers a unique combination of potentially higher returns, reduced risk, and a steady income stream.

Trust deed investments play a crucial role in real estate financing. Essentially, you act as a lender, providing capital to a borrower secured by a piece of real estate. This loan is documented by a legal document called a trust deed, which grants a trustee (often a title company) the authority to seize the property if the borrower defaults on the loan.

Here are 5 compelling reasons why these investments should be considered for a well-rounded portfolio:

  1. Higher Potential Returns: Trust deed investments typically offer higher interest rates than traditional investment options like bonds or savings accounts. This return on investment (ROI) is directly tied to the Loan-to-Value Ratio (LTV) of the underlying property. The LTV is the loan amount divided by the appraised value of the real estate. Generally, higher LTV loans offer higher interest rates but are slightly riskier.

  2. Diversification and Reduced Volatility: A diversified portfolio is crucial in mitigating risk and achieving long-term financial goals. The beauty of these investments lies in their lack of direct correlation with the stock market. While stocks can experience significant swings, the real estate market tends to be more stable, offering a hedge against market downturns. This diversification helps create a more resilient portfolio.

  3. Secured Investment with Less Risk: Unlike stocks or bonds, trust deed investment is secured by a tangible asset – real estate. This means that if the borrower defaults, the lender has the right to foreclose on the property and recoup a portion, if not all, of the loan amount. At Fidelity Mortgage Lenders Inc., we further mitigate risk by employing conservative lending practices. We maintain a low LTV ratio on our funded loans, meaning the borrowed amount is a smaller percentage of the property value. This provides a significant buffer in case of a foreclosure.

  4. Passive Income Stream: These investments generate regular interest payments throughout the loan term. This provides a predictable and reliable source of passive income that can be used to reinvest, supplement your regular income, or achieve your financial goals. Over time, the power of compounding interest can significantly grow your investment.

  5. Control and Transparency: At Fidelity Mortgage Lenders Inc., we empower you to actively participate in investment decisions. Unlike others, we provide investors with the specifics of each available investment opportunity. This transparency allows you to choose individual loans that align with your risk tolerance and investment goals. You can select investments based on factors like property location, loan amount, and LTV ratio.

Explore Trust Deed Investment and Its Amazing Potential with Our Experts

The potential benefits of these investments are clear: higher returns, reduced risk, and a steady income stream. At Fidelity Mortgage Lenders Inc., we are committed to providing our clients with access to high-quality trust deed investment opportunities. Our experienced team will guide you through the investment process and answer any questions you may have. Contact us today to learn more about how these investments can help you achieve your financial goals. Call us at (800) 752-9533 to get started.

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