When the market speaks through the actions of investors, it tells a certain tale of how appealing or unattractive an asset is to a buyer in a very convincing manner, very promptly.  This was witnessed in the most recent investment opportunity in private mortgage notes with EquityBuild Finance, the funding unit of EquityBuild, a real estate investment firm.  The needed capital was delivered by investors in much less than 24 hours!

 Private mortgage notes are loans from an investor or a group to those seeking to buy a property.  Many times traditional lenders such as banks, credit unions, and mortgage brokers cannot meet the mortgage needs of the market.  As a result, there is a strong demand for private mortgage money.

What has also been robust has been the returns from private mortgage for the investors of EquityBuild Finance.  In a recent webinar, Shaun Cohen, the President of EquityBuild Finance, stated that investors were earning 12% from private money investing.  Making this high yield real estate investing even more appealing is that there have been no defaults for EquityBuild Finance in its private mortgage note deals, according to Cohen.

The most recent opportunity demonstrates why there is this unique mix of high reward with low risk.

There was $250,000.00 needed.  Cohen pointed out potential investors that,"The buyer is very strong with a 720+ mid score and 250k+ in income.  He is a commercial underwriter for MetLife Hedge Fund and she is a Consultant for Deloitte and Touche."  The financials of the deal were equally alluring, as Cohen informed those who invested, that "You will receive your standard 3 months of prepaid interest at closing and the 1% a month after that, as is standard with our loan program. "

That track recorded combined with that return from that deal certainly explains why it closed so quickly!

With returns that high (12% means it doubles every year) there are naturally tax considerations.  For those, private mortgage notes can be held in a retirement account, such as an individual retirement account (IRA).  As assets held in retirement accounts are tax free, that means the interest income received from a private mortgage note is not taxed.  Should it be sold for a profit, there are no taxes on the gains, either.

While an individual can lend to another in a single transaction, it is far wiser to passively invest in private mortgage notes with EquityBuild Finance.  The fact that the recent deal was fully funded so promptly demonstrates quite clearly the appeal of the investment.  While there are many forms of real estate investing, the high returns and low risk from the private mortgage notes of EquityBuild Finance are very difficult to match, which is why the most recent deal closed so quickly.