Trust Deed Investments In Charleston – What To Look For And What To Avoid

 

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 If you are a local or native West Virginian  looking to invest in your local market, then consider Trust Deed Investments (Deed Of Trust) as a fantastic way to earn solid returns and diversify. In fact, trust deed investments are one of the methods that the wealthy use to make much bigger returns on their investments than anything you can get on the open market. In a nutshell, a trust deed investment is a private loan that’s secured by real estate.  The key word is “secured”!  Most are short-term, generally under two years, and normally at a high interest rate – 7-15% is typical, even when banks are lending at 3-7%. Look at what your bank rates are for cd’s and savings are right now!

Surprisingly, there’s a lot of competition from borrowers who are willing to pay these kinds of rates to lenders – and an increasing number of investors who are interested in funding them. At We Buy Houses WV, our loyal investors are always pleased and asking when we have another investment opportunity coming up!

Why would investors take deals that banks would pass on?

There are lots of reasons, so let’s start with the basics.

Banks and lenders fall under a lot of regulations that private money lenders don’t necessarily have to follow, especially since they’re not federally insured.

Local trust deed investments are actually more like old-school investing. Trust deeds are built on trust – just like back in the day, when it was common for deals to be sealed with handshakes and there weren’t so many lawsuits.  Except this handshake has a piece of property attached to it in case the deal goes south!

Trust deeds aren’t just based on credit scores and ratios.

For these deals, insider knowledge, relationships and potential value matters a lot more than the score assigned by a computer.

But like other high-return investments, there’s a lot of risk involved if you don’t know what you’re doing.

The investors who make a lot of money on trust deeds work with highly reliable brokers, attorneys and experts who help them evaluate the full potential of the loan – and assess the risks involved.

If you’re interested in capturing solid returns from the local Charleston trust deed marketplace, we may be able to help you

As a general rule, most investors want a high degree of security that the borrower stands to make 20-50% ROI with the funds he or she borrows. If the borrower’s plan is too risky or shows signs of probable failure, it’s wise to pass on the investment.

We’re not mortgage brokers – sometimes, we may partner with qualified investors to secure deals, and a trust deed is one tool at our disposal.

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