Generally, trust deed investing is the term that describes an investment in a loan that is secured by real estate. “Trust Deed” refers to the actual legal instrument that secures a promissory note with a piece of real estate as collateral. In some parts of the country, this is called a mortgage, but the term is relatively universal regardless. Trust deed investments can come in many forms, including direct loans between two individuals, the purchase of existing loans through a broker, the purchase of discounted debt from institutions or the combining of funds from multiple investors to make larger loans.

 

Each of these structures carries different nuances and technicalities, but the overall philosophy and concept is the same. Trust Deed Investors are looking for opportunities to invest in loans to other individuals and entities that are well-secured by valuable real estate, and doing so correctly can provide a low risk investment vehicle that provides double-digit annualized returns.