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Trust Deeds and Real Estate Investing

Trust Deeds and Real Estate Investing. Disclaimer/Disclosure.

heather-carson
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Trust Deeds and Real Estate Investing

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  1. Trust Deeds and Real Estate Investing

  2. Disclaimer/Disclosure Money invested through a mortgage broker is not guaranteed to earn any interest or return and is not insured. Before investing, investors must be provided applicable disclosures. Past performance does not guarantee future results or success. Consolidated requires a $20,000 minimum investment. Nevada MLD#284 – Consolidated Mortgage, LLC. 1291 Galleria Drive, Suite 220 Henderson, NV 89014 P. 702.739.9090/877.739.9094

  3. Company Overview • Founded in 1977 • Over $2 Billion in real estate transactions closed • Over $500 Million under management

  4. What is a Trust Deed / Mortgage? Definition of Trust Deed Private Notes - Public Deeds 1st Trust Deeds Only

  5. Types of Trust Deeds • Land Acquisition • Land Development • Construction • Bridge

  6. Why Borrow from Consolidated? Speed Flexibility

  7. The Art of Choosing Good Loans • 5 C’s of Lending • Collateral • Capacity to borrow • Character of the borrower • Capital • Conditions of the market • Fact Sheets

  8. Risks Involved in Trust Deed Investing • Borrower Defaults • Illiquid or Non-liquid • No tax benefits for non-qualified funds

  9. Why does a Trust Deed belong in your portfolio? Is your portfolio diversified? Growth vs. Income (Example: 100 – Age = Growth Percent)

  10. Backed by company issuing bond Backed by borrower and collateral (real estate) Fixed Income Bonds vs. Trust Deeds • Interest paid monthly, quarterly, semi-annually, annually • Interest paid monthly • Maturity Dates vary • Maturity dates typically are 12 months • Yield is traditionally 6 – 8% • Yield is traditionally 12% and higher • Secondary market • No Secondary market

  11. Backed by Insurance Company Backed by borrower and collateral (real estate) Fixed Income Annuity vs. Trust Deeds • Typically interest paid annually • Interest paid monthly • Maturity – Date of death • Maturity dates typically 12 months • Yield is traditionally 3 – 5% • Yield is traditionally 12% and higher • Tax deferred if invested with IRA • Tax deferred

  12. Why is there an opportunity to invest? • State of the Market • Credit Crunch • Real Estate Bubble • State of the Southwest • Increasing Population • Increasing Employment

  13. Clark County Population

  14. Southwest Regional Employment

  15. Local Hot Spots – Las Vegas The Palazzo Palms Place Capital: $1.6 Billion Rooms: 3,025 suites Opened: Jan. 2008 Capital: $650 Million Expansion Rooms: 347 Condos Opened: Feb. 2008 Encore The Plaza City Center Echelon Place Capital: $1.9 Billion Rooms: 2,045 suites Estimated Completion: 2008 This project will make Wynn Las Vegas the fifth largest hotel in the world. Capital: $5+ Billion Rooms: 4,100 Estimated Completion: 2011 Current plans are to create a replica of the ultra luxurious New York namesake. Capital: $8.4 Billion Rooms: 6,650 Estimated Completion: 2009 This construction project is the most expensive privately funded in U.S. History Capital: $4.8 Billion Rooms: 4,713 Estimated Completion: 2010 The Echelon will be divided into five partially separated towers.

  16. Property Values Land, Development and Construction Lending Opportunities Credit Crunch Bank Quality Loans & Borrowers Lending at the bottom Have We Hit Bottom? Why Lend in Today’s Market?

  17. Example 2006 Value $5,000,000.00 2008 Value $3,000,000.00 2008 Loan $1,800,000.00 2008 LTV 60% Would you make this loan?????

  18. What types of funds can I use to invest? • Money in checking and/or savings account • Roth IRA or IRA • Corporate Funds (LLC, Inc, etc…)

  19. Benefits of Trust Deed Investing • Secured by Real Property • Short Term Commitment • Double Digit Annual Returns • Interest Paid Monthly • Portfolio Diversification

  20. Thank you for attending Q & A

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