Plenty of people turn to real estate as an investment option, but just as with other income strategies, it may not provide you with the returns you're looking for by itself.
If nothing else, real estate investment can be a long, complicated process. Whether you're flipping houses or converting rental properties, you may find yourself spending a lot more time contending with complex procedures than creating steady cash flow.
The experts at Global Banking and Finance Review say that in addition to large amounts of time and money spent on real estate investment, you also have to deal with the challenge of actually finding and acquiring property.¹
But what if you put your real estate knowledge to work with an investment where the opportunities come to you?
Through peer-to-peer lending, you can do just that and add greater cash flow to your real estate investment endeavors.
Create cash flow like bankers do
In The Banker's Code, George Antone outlines a secret bankers around the world already know: Lending money is a proven way to generate high returns.²
Anyone in the real estate investment game already knows how difficult it can be to obtain funding from traditional lending sources. However, there are plenty of individuals out there willing to pay a premium to get the money they need.
Instead of being the borrower, you can create strong cash flow by becoming the lender.
By filling a very real void in today's marketplace, you'll be able to help borrowers get the short-term capital they need while benefiting from interest rates that can reach much higher than other investment opportunities.
Maximum returns with market knowledge
Even if you've only been investing in real estate for a short time, chances are you've learned a lot and built up a network of contacts. This gives you an edge in the private lending market, as you'll be well aware of the need investors have for fast, short-term funding.
Your knowledge of the local market, as well as how real estate investment works, will make choosing how and when to loan money that much easier.
Cut your time commitment while increasing income
Arguably the greatest disadvantage of real estate investing is the time it takes.
Even expert house flippers have to lock themselves into specific deals that can often drag on for years before they see returns.
Through private lending, you can recover capital in a fraction of the time and ensure you have the cash flow you need while more long-term real estate investments progress. Common loan terms range from nine to 12 months, and if you're lending to other real estate investors, you can benefit from shorter lending periods standard for fix-and-flip investments in growing markets.
There's no shortage of real estate investors in need of funding, and over time you can develop strong working relationships with successful investors in your area, providing you with a steady source of income and a stronger level of financial security.
It's for this reason that some private lenders eventually move away from the real estate investment game altogether to focus primarily on lending.
See the real estate market from a new angle
If you know the real estate investment game, but also recognize you need more cash flow, now's the time to explore peer-to-peer lending.
Sign up for a free strategy session with one of our certified wealth strategy experts to learn more about private lending and how it can help you reach your income goals.
1. "Advantages and disadvantages of investing in real estate," 2013, Global Banking and Finance Review.
2. "The Banker's Code," George Antone, 2012, WealthClassesPublishing.