I've been looking at this platform since last year based on recommendations of a buddy who's been investing with them for several years and in February I finally decided to go in. So far it's been pretty good, some of the loans I invested in have already paid off in as little as 2 months.
This group is based in Atlanta, has been around for 5+ years and offers a way for individuals to invest in real estate markets across the country by participating in real estate loans with as little as $10 per.
They do their own underwriting and pre-funding of the loans, rank loans by tiers (A, B, C, D, etc) and assign interest rates based on various factors like skin the game (borrower equity), borrower experience, location/market, loan-to-value, etc. They manage risk by monitoring construction/renovation progress and reimbursing the borrower for costs incurred via monthly draws based on project updates.
Rates range from 6% to 16%. If you invested equally in all their loans last year, your annual return would've been around 10.5% after all costs/losses.
The aggregate platform-wide principal loss for all loans last year was less than 0.5%, but clearly if you invest in only a handful loans and one of them fails, your loss could be substantial so the key is to diversify and be in at least ~20 loans.
This could be somewhat of a problem but there are ways to mitigate it. If you only want to go in with, say, $3k, that means you're investing $150 per property/loan. At 10%, your $150 investment is expected to return $15, which is too low to justify any kind of significant due diligence.
You could simply put $10 in every single loan they have for ultimate diversification but I don't like this shotgun approach. Instead, what I've been doing with a few of my buddies is when one of us finds a loan he likes (interest rate, credit tier, skin-in-the-game, market, loan-to-value, zillow sale comps and general area market), he shares it with others.
I like the "B" through "D" space. "A" tier returns are too low to justify the hassle and "E" or lower carry more risk than I want to take.
Here is a sample "D" loan, this one is in Lake Worth, FL: https://www.groundfloor.us/investments/laf49738d587c3
$56k equity, $241k loan. They claim appraised value at completion is $345k, which is in line with recent sales on that street and in the area. The house was purchased for $255k last month and the work already started. 12 month loan at 13.0%.
Check it out if you're interested.
FAQ: http://support.groundfloor.us/customer/en/portal/topics/620522-investors/articles
2018 year review: https://blog.groundfloor.com/2018-year-in-review
I can't remember, but you may need to register to see all available loans as well as loans that funded or already repaid. Before you do so, PM me for referral link so that both you and I can get an extra $20.
This group is based in Atlanta, has been around for 5+ years and offers a way for individuals to invest in real estate markets across the country by participating in real estate loans with as little as $10 per.
They do their own underwriting and pre-funding of the loans, rank loans by tiers (A, B, C, D, etc) and assign interest rates based on various factors like skin the game (borrower equity), borrower experience, location/market, loan-to-value, etc. They manage risk by monitoring construction/renovation progress and reimbursing the borrower for costs incurred via monthly draws based on project updates.
Rates range from 6% to 16%. If you invested equally in all their loans last year, your annual return would've been around 10.5% after all costs/losses.
The aggregate platform-wide principal loss for all loans last year was less than 0.5%, but clearly if you invest in only a handful loans and one of them fails, your loss could be substantial so the key is to diversify and be in at least ~20 loans.
This could be somewhat of a problem but there are ways to mitigate it. If you only want to go in with, say, $3k, that means you're investing $150 per property/loan. At 10%, your $150 investment is expected to return $15, which is too low to justify any kind of significant due diligence.
You could simply put $10 in every single loan they have for ultimate diversification but I don't like this shotgun approach. Instead, what I've been doing with a few of my buddies is when one of us finds a loan he likes (interest rate, credit tier, skin-in-the-game, market, loan-to-value, zillow sale comps and general area market), he shares it with others.
I like the "B" through "D" space. "A" tier returns are too low to justify the hassle and "E" or lower carry more risk than I want to take.
Here is a sample "D" loan, this one is in Lake Worth, FL: https://www.groundfloor.us/investments/laf49738d587c3
$56k equity, $241k loan. They claim appraised value at completion is $345k, which is in line with recent sales on that street and in the area. The house was purchased for $255k last month and the work already started. 12 month loan at 13.0%.
Check it out if you're interested.
FAQ: http://support.groundfloor.us/customer/en/portal/topics/620522-investors/articles
2018 year review: https://blog.groundfloor.com/2018-year-in-review
I can't remember, but you may need to register to see all available loans as well as loans that funded or already repaid. Before you do so, PM me for referral link so that both you and I can get an extra $20.
