Quick Take - Private Money and Private Lending Insights with Heather Dreves | Summary and Q&A

TL;DR

Private lending is a viable option for diversifying investments beyond traditional avenues, offering potential high returns backed by real estate assets.

Key Insights

• 🔒 Private lending offers an avenue for diversifying investment portfolios beyond traditional options.
• 🥹 Real estate-backed investments provide a level of security, even during market fluctuations.
• 👻 The accessibility of private lending has expanded to include non-accredited investors, allowing individuals with lower capital levels to participate.
• 🔠 Accredited investors, often professionals with substantial capital, can benefit from private lending to augment income and grow their capital.
• 🥅 Private lending should be approached with a clear understanding of investment goals, risk tolerance, and financial capabilities.
• 🧡 Private lenders typically have tie-up periods, ranging from 12 months to several years, where capital is committed.
• 🤕 The demographics of accredited and non-accredited investors differ, with age, financial goals, and risk tolerance playing a significant role.

Transcript

all right time for another quick take with the real estate law podcast Jason Muth here I'm one of the hosts of the show and we're going to revisit an episode with Heather Drees she is the director of funding and fund management with secured Investment corporation out of cordal Idaho and during this episode Heather explained private lending very wel... Read More

Questions & Answers

Q: Who should consider investing in private lending?

Private lending is suitable for a range of investors, including high net worth individuals, professionals seeking to replace income, and those looking to grow their capital through real estate-backed investments. It is important to assess financial situations, risk tolerance, and investment goals.

Q: Is private lending a short-term investment?

While private lending typically involves committing capital for a set period, it is not meant for day trading. The tie-up period for the discussed fund is 12 months, which is relatively short in the realm of real estate funds. Investors should be prepared to stay invested for the specified duration.

Q: What is the profile of an accredited investor?

Accredited investors are often in their mid-40s to mid-50s and typically include professionals like doctors, dentists, chiropractors, and business owners. They usually have accumulated capital through the sale of practices, businesses, or investments and seek opportunities to replace income or achieve growth.

Q: How does private lending attract non-accredited investors?

With recent changes in regulations, private lending options have become available to non-accredited investors as well. This allows individuals with lower capital levels, such as young investors or those with unutilized retirement funds, to participate in real estate-backed investments as they aim for growth and financial security.

Summary & Key Takeaways

• Private lending is a method of investing that allows individuals to diversify their investment portfolio beyond active investments.

• Accredited investors have historically had access to private lending, but recent changes in laws have opened opportunities for non-accredited investors as well.

• Private lending offers the potential for high returns, with investments backed by real estate assets, and the ability to pivot during market shifts.