How to Safely Invest in Real Estate Trust Deeds

Real Estate Trust deeds are simply loans made out to borrowers against a specific real estate property.  In the case where private investors provide capital against the value of real estate for another party, a trust deed would secure the private investment.  In return for the capital the real estate owner needs, a short term and high yielding interest rate is offered to the capital provider. Although a short term investment that typically has low leverage, there is always risk with any investment – which is why the following tips can help you mitigate risk

INSPECT THE PROPERTY

Before lending any money, it’s important physically inspect the property on which you are lending.  As a private lender that facilitates trust deed investments on behalf of institutional and accredited investors, we take conservative stance in evaluating a property, the borrower, risk, and independent assessment of value — but welcome investors who want to “see for themselves” to supplement peace of mind.

LEGAL REVIEW OF DOCUMENTS

As the trust deed is a legal document security an investors interest against a property owned by another party, it’s important to have all loan documents professionally reviewed by experienced legal counsel.  Carlyle Capital has forged relationships with the leading law firms in this industry for a comprehensive review of all documents (which is paid for by the borrower and not the investor).

GET MAXIMUM TITLE INSURANCE

A title insurance policy can protect an investors interest and avoid unexpected risks.  Title insurance ensures professional verification and integrity of a property’s documents, while protecting investor interests by fully researching the background of the property.

DIVERSIFICATION

As with any investment, diversification helps spread risk and reduces exposure to the risk of a particular investment. In trust deed investments, you can diversify by buying in on a deal structured in a way that you don’t provide the whole amount for the loan. This means that each party will risk only a small amount. The returns on each single deal might be low but when you compound that with many small deals you end up with a relatively low risk investment portfolio.

These tips should set you on your way to safe trust deed investing.

You may also contact us at any time to talk to one of our specialists about potential invesetment opportunities.

We offer first trust deed investments to our investor population in the following areas:

Business Purpose Residential

Non-Owner Occupied Single Family, Rental Properties and 2-4 Units

Commercial

Office, Multifamily, Industrial, Mixed Use, Hospitality, and Special Purpose

Land

Acquisition or Refinance toward eventual development of property.

Residential Construction and Rehab

Ground up Construction and Fix-and-Flip

Commercial Development

Construction to maximize best use of property.

Cannabis

Unique financing for licensed and experienced operators.

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