Trust deed investment is a form of property investment that is appealing to some people who haven't seen the returns they wanted from things like stocks, bonds, or mutual funds.
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Today, we’re talking all about trust deed investing with Jonathan Marshall from Bella Vita Property Investments.
Trust deed investing is similar to what the banks will do when they finance real estate acquisitions. Many people think of real estate investment from the ownership approach, as if they'll own the property. Trust deed investing is the banker's approach, where you finance the real estate by loaning an investor money for a property. Like a bank, you would realize the return of the investment via mortgage checks or long-term equity share on the property.
Many consider it a more lucrative investment strategy because they're used to the typical stock, bonds and mutual funds where returns may not be what they expect. With trust deed investment, you can see returns from 6% up to double digits and even up to 20% depending on the type of investment.
The best candidate for these are investors with liquid capital, or some cases, a qualified self-directed IRA. A lot of investments will be looked at one of two ways. Do you want to be the sole person on the deed of trust, or are you willing to be a co-investor with other people? There are ways to do fractional investments or a trust account, so you can be an investor if you don't have enough money to front the entire investment.
Jonathan has seen some investors start with as little as $10,000. However, given higher home prices in the California Market, you probably need an initial investment of $300,000 or more to be a sole entity.
Personally, Jonathan prefers investments with a twelve to eighteen-month timeframe; if his money is not sitting waiting for a return, he can re-invest those funds, and put them to work earning again. At times, it’s possible to get a six to eight month turnaround, but Jonathan prefers to set the expectation of a 10 to 12 month turnaround with the expectation that it may be up to a year to 18 months.
If you have questions about trust deed investing, you can find Jonathan at his website or call him at 562-493-4807. If you have any other questions about real estate, give me a call or send me an email. I would be happy to help you!
