What Are the Benefits of Trust Deed Investing?

If you’re considering investing in trust deeds, you may wonder whether that’s the best decision ever. Perhaps your current portfolio includes stocks, commercial property, or even bonds. However, trust deed investing has many benefits as an alternative or addition to most traditional options for generating fixed, passive income. Here’s a look at some key perks of investing your money this way.

High Return on Investment (Fixed Yield)

Trust deeds are a high-yield income option that performs much better than assets like bonds or stocks. In periods of volatility across your investment portfolio, trust deeds may be the only assets with a steady, high ROI. Gains of 7.5% to 13% are possible with trust deeds, including when other assets aren’t performing well. The investment is linked to the actual real property and guarantees regular monthly payments.

Portfolio Diversification

It’s always a good idea to diversify your investments, which is one of the many benefits of trust deed investing. To cushion yourself against any portfolio volatility, consider trust deed funding in multiple real estate markets. Another viable way to spread your risk is multi-lender or fractional loans in which you finance different loans jointly with other investors.


Trust Deed investors don’t take direct ownership of the property, but they do have a recorded lien to support the debt owed on the property. The property itself is the collateral for the loan, so as long as the loan-to-value is conservative, there’s very little risk of losing money with Trust Deeds. Trust Deeds are usually paid off with a refinance or sale of the property, and if for some reason, the borrower is unable to pay back the loan, the investor would be paid off through a foreclosure sale, or they would actually become the owner of the property, if there were no bidders at the foreclosure auction.

Trust Deed Stability and Predictability

If you’re seeking a safe, predictable source of regular fixed income, you couldn’t go wrong with trust deed investing. Just ensure there’s proper underwriting and you’re not over-leveraging the property. For the entire mortgage term, the monthly payments and interest rates stay the same, which can simplify your financial and investment strategy.

Tax Benefits

As a trust deed investor, you may finance loans through your self-directed pension scheme, IRA, or 401Ks. It’s often a viable option, whether you’re after high yields of 10% to 12% or lower ROI of 6.5% to 8.5%.

No Property Management Hassle

A trust deed allows you to invest in real estate and leverage its high-yield benefits without necessarily owning the property or becoming a landlord. This investing approach eliminates the headache associated with managing real estate and tenants. Once you’ve done your homework on the loan and property, you provide the funds, and the trust deed broker takes care of the rest. You’ll be receiving your monthly check or electronic payments for the duration of the loan.

Start Investing in High-Yield Trust Deeds Today!

With these clear benefits of trust deed investing, you have good reasons to incorporate it into your portfolio diversification. It’s an excellent way to generate steady, regular income without owning or managing real estate property. Are you interested in high-yield trust deed investments? Contact us today at Fidelity Mortgage Lenders, Inc. to get started!

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