Fractionalized Loan Investing

FUNDING LARGE LOAN 


To get some of the larger loans done, sometimes we have to “fractionalize” the loan.
This is the formal term we use which means having more than one investor contribute funds to get the loan done.

 

We've listed some of the UPs & DOWNs of “fractionalization” from the Investors point of view.
 

UPs: These are just a few of the exciting reasons to do a “fractionalized” loan. 


 

  • This allows you to have a share in a very good loan,
    spreading the risk to a number of investors.

     

  • It allows you to get your money rolling out in the field right now 
    rather than it waiting for a loan that fits your available funds.

     

  • Rather than just investing on a single loan,
    you have the opportunity to spread 

    your investment
    funds to a number of smaller investments.


 

DOWNs: There's Not Too Much Downsides
 

  • All the investors involved need to agree on a course of action if the loan gets in trouble.

    This is rarely an issue, we haven't had a residential foreclosure yet. 
    The main decision that matters is to foreclose or not foreclose.
    And the answer is pretty easy for that question. 

     



* Fractionalization can start from$100,000 to $1,000,000.

By reading this, we hope our investors were able to learn something new & realize that there are multiple ways of investing!