Q. What is Trust Deed Investment?
A. A Trust Deed, also known as a Deed of Trust or Mortgage, is a security instrument recorded at a County Recorder’s Office. It creates a lien on the real estate described therein.
Q. What does the Trust Deed Secure?
A. It secures a Promissory Note. The Promissory Note is the borrower’s promise to repay the loan. It is also the evidence of indebtedness.
Q. What is Trust Deed Investing?
A. Trust Deed Investing is the loaning of money using real estate as collateral. Loans are secured by real estate using a Promissory Note and a Trust Deed, executed by the borrower.
Q. What rate of return can I expect?
A. You can expect Trust Deed Investments to pay 10-12% interest.
Q. Who should invest in Trust Deed Investments?
A. The typical Trust Deed investor is a person or entity looking for a higher rate of return on their capital, consistent with safety.
Q. Why would an investor get involved?
A. To receive a higher fixed rate of return, without sacrificing safety of principal and income.
Q. Can I use my retirement funds such as IRA, Keogh, and 401K?
A. Yes, Trust Deed Investments are an approved investment for IRA, IRA-Rollover, Keogh, 401K, Pension, and Profit Sharing Accounts.
Q. How do I go about investing these Retirement Account funds?
A. You will need to have an Independent Plan Administrator to handle your retirement account. An Independent Plan Administrator is one that does not sell or offer any investment products but simply administers the account and files the necessary forms with the IRS. There are two reliable Independent Plan Administrators in the Denver area.
Q. What types of property will be security for these loans?
A. Properties will be non-owner occupied residential properties, small commercial properties, improved lots, and in some cases, vacant land.
Q. Why would a borrower pay such a high rate of interest?
A. There are a number of reasons. The primary reasons are credit problems of the borrower, property such as land that institutional lenders will not loan against, and the desire of the borrower to move quickly.
Q. What percentage of the property value will be loaned to the borrower?
A. We will never loan more than 65% of the value of any property.
Q. I’ve been told, “Anything that sounds too good to be true probably is.” How do I know my money is safe?
A. The equity in the property is your primary protection. For example, if a property appraises for $100,000, the maximum loan amount would be $65,000. This protects the investor against a reduction in the value of the property.
Q. When will I receive my interest payments?
A. Loans will be structured to require the borrower to make monthly payments. In some cases, payments will be quarterly. In some cases, we will require the borrower to prepay six months interest.
Q. What if the borrower does not make the payment?
A. You should call Silver Jack Capital. We will handle any problems that may arise.
Q. What is the length of the loans?
A. The loans will be for a period of one to two years.
Q. How will the loan be repaid?
A. The loan will be repaid either by the sale of the property or by the owner obtaining a new loan.
Q. Who will service the loan for me?
A. There are a number of title and loan service companies that service these loans. These companies charge a one time set-up fee and monthly service fees. These fees are paid by the borrower. In the alternative, payments can be sent directly to the investor. Most investors choose to have payments sent directly to them.
Q. How do I get started investing in Trust Deeds?
A. Once you have reviewed the information and decided that you wish to invest in Trust Deeds, simply let us know. We will help you review the available Trust Deeds. We will also place you on our mailing list and/or email list.
Q. Who evaluates the Trust Deed investment opportunities?
A. Silver Jack Capital will perform the evaluation of the property and the borrower.
Q. What are the steps in the evaluation process?
A. Inspection of the property by Silver Jack. Appraisal of the property by a licensed appraiser selected by Silver Jack. Title report from a licensed title company.
Q. What documentation do I receive?
A. In addition to a copy of the appraisal and the title report, you will receive a Note, the Trust Deed and a policy of Title Insurance.
Q. What’s the process for making an investment?
A. The closing of the loan is handled by a title company. You send your money directly to the title company’s trust account.
Q. What fees does Silver Jack Capital charge me?
A. You do not pay any fees or commissions to Silver Jack Capital. The commission we receive is paid by the borrower.