About The Level 4 Funding Trust Deed Investing
The mission of Level 4 Funding is to provide the lender with the best possible Trust Deed opportunity. Loaning in Deeds of Trust is a great way to obtain a constant secured return on your money. Your trust deed is backed up by a hard asset, typically real estate, and the payments flow directly to you. You are in complete control of the loan; all documentation, Notes, Deeds of Trust, and Personal Guarantees are yours, with no middle man in between. All income goes directly to you, with the borrower paying for all processing fees.
Why Trust Deed
- Your Trust Deed is secured by real property, not a promise from the bank or the government.
- You can go look at your Deed of Trust. Go drive by and see the actual property.
- You have a good equity position in the property, typically 30-70% of the value.
- The payments go directly to you.
- You are getting an outstanding return on your Trust Deed when compared to the bank.
- You are in 1st position on the Deed of Trust.
- You have a personal guarantee from the borrower in the Trust Deed.
- The property is protected by Hazard Insurance.
- Your title is protected by a Title Policy.
- You are in control of your loan.
When You Invest In Trust Deeds, You Receive The Following:
- Mortgage Summary of the Trust Deed
- Notarized Assignment of Deed of Trust to you
- Promissory Note
- Personal Guarantee from the borrower
- Title Report for the title company
- Lender Title Insurance ALTA Policy
- Homeowner insurance with you added as the additional insurance
- Mortgage Application of the borrower
- Credit Report of the borrower
- An appraisal from independent, certified appraiser or a CMA or BPO
- Mortgage Serving Agreement
- Joan got tired of the poor returns from the bank and took my money out and is now making 12% on the loan. She is much smarter than me.
- Donna is tired of the poor bank return and is now making 12% of her money.
- David got tired of the poor market returns and is now making 12% on his money.
- I found that this is a quick way to earn 12 percent of my money. Don’t know where else you could get such a nice return on your money” – Joan.
- I’ve done 3 deals, and I love the 12% on secured money.” – Donna
- I was scared and not certain about the deals, but when I talked to my attorney, I realized the money was safe and secured, I was ready to go” – David
Your rate of return varies from 9-29%, however the rate of the 1st Trust Deed is normally 10%.
Loan amount start at $50,000.
The loan on the Deed of Trust is from 6-24 months.
We make a Broker Fee, paid by the borrower, typically 1-3% of the total amount.
The investor typically makes 10-12%.
A Trust Deed is a document recorded with a county recorders office creating a secured lien on real property, which provides collateral for lenders and trust deed holders.
1. Your Trust Deed is secured by real property not a promise from the bank or the government.
2. You can go look at your Deed of Trust. Go drive by and see the actual property.
3. You have a good equity position in the property, sometimes 30% of the value.
4. The payments go directly to you.
5. You are getting a very good return on your Trust Deed compared to the bank.
6. You are in 1st position on the Deed of Trust.
7. You have a personal guarantee from the borrower in the Trust Deed.
8. The property is protected by Hazard Insurance.
9. Your title is protected by a Title Policy.
10. You are in control of your loan.
A borrower who owns or wants to own real estate needs a Mortgage. The borrower executes a Promissory Note wherein the borrower promises to repay the lender. The recorded Trust Deed creates the secured interest attached to the borrowers real property. If the borrower does not pay as promised, the Lender – Trust Deed Investor can look to the real property for repayment and/or recovery of their invested capital.
A Trust Deed loan occurs when an investor purchases all or part of the Note and Deed of Trust. The Investor can earn a 10%-12% annualized yield and receives monthly interest payments.
From a borrowers perspective, why would a borrower pay higher rates for their Mortgages when bank Mortgages are less?
There are many reasons borrowers request private money Mortgages. A few include:
Short-term (1 to 5-year) Mortgages
To pay judgments and liens such as Federal or State taxes.
Property may have some problems that make it difficult to obtain a bank Mortgage
The LTV or Mortgage to value ratio is the ratio between the mortgage Mortgage and the value of the real estate, pledged as security, which is expressed as a percentage. This is referred to as the Mortgage-to-Value Ratio:
Mortgage = $225,000
LTV= 34.6% ($225,000 divided by $650,000)
This means that the Mortgage expressed as a percentage of the property is 34.6%. The higher the Mortgage-to-value ratio, the greater the lending risk because the protective equity declines as the LTV increases.
Example: A single-family home with four bedrooms and 2,5 baths is valued at $425,000. If we make a 70% LTV, the Mortgage is $297,500. ($425,000 X .70 = $297,500) The difference between the value of the property and the Mortgage is $127,500. This is referred to as protective equity or equity cushion.
What should an Investor expect in their loan package from a mortgage broker to help them make an intelligent loan decision?
In order for you to make an informed decision, you should require the following in your package:
Mortgage Summary of the Trust Deed
Notarized Assignment of Deed of Trust to you
Personal Guarantee from the borrower
Title Report for the title company
Lender Title Insurance ALTA Policy
Homeowner insurance with you added as the additional insurance
Mortgage Application of the borrower
Credit Report of the borrower
An appraisal from an independent, certified appraiser or a CMA or BPO
Mortgage Serving Agreement
When you are ready to invest, call us or contact us below. Let us know how you take title to your Trust Deed and how much you are prepared to Loan. You may hold the title as an individual, family trust, partnership, corporation, corporate pension plan, IRA, etc.
Your interest is paid to you monthly. Because of the nature of this loan, there are some conditions that have to be met: a Minimum Trust Deed of $50,000. There are many requirements to meet to become a qualified investor. Please contact your investment adviser to discuss the qualifications. This is not an offer to invest; the investment offer is only made through the offering memorandum and to qualified investors.
Give us a call at 623-582-4444. Or fill in the form below, and we will contact you ASAP.