Investments in individual trust deeds could yield higher returns than investing into a fund. This is the usual and preferred method for active investors who are experience in real estate investing. Each loan needs special attention and lots of analysis and due diligence for both the borrower and the property. Once a loan is paid off the money will sit as cash until it re-designated. Individual trust deed investing needs a steady and regular flow of sourcing deals so as each loan is paid off the money can be reinvested in another property.
It is less time consuming to invest in professionally managed funds, which makes it a preferred method for more passive investors and investors without broad real estate investing experience. Well organized fund managers have an infrastructure set up with the expertise to perform the necessary analysis and due diligence for individual loans. Establish fund managers are in a more entrenched position to source good deals and continuously reinvest the money.
Whichever appeals to you, it is so important to research the key person that is creating the investments. For individual loans, this is a broker. In the instance of a fund, it is the actual manager of the fund.