Buy Trust Deeds 🔖

If a borrower defaults, you must be prepared to initiate foreclosure. This process can be daunting and may require you to eventually take ownership of the property to recoup your investment.

In Scotland, a "trust deed" is a formal debt solution where a person agrees to pay back what they can afford over a set period (usually four years) to settle debts. buy trust deeds

While potentially lucrative, buying trust deeds is not without risk. If a borrower defaults, you must be prepared

Because the loan is secured by real estate, the investor has a tangible asset to fall back on if payments stop. While potentially lucrative, buying trust deeds is not

Trust deeds are not as liquid as stocks. Your capital is usually tied up for the duration of the loan term. Different Contexts: Scotland vs. USA

A neutral third party that holds the legal title until the loan is satisfied or initiates foreclosure if the borrower defaults. Why Investors Buy Trust Deeds

Experienced investors typically do not fund loans higher than 70% LTV . This ensures there is enough "cushion" or equity (at least 30%) in the property to cover the investment if a sale is required after foreclosure.