Trust Deeds and Real
Estate Investing
Disclaimer/Disclosure
Money invested through a mortgage broker is not
guaranteed to earn any interest or return and is not
insured. Before investing, investors must be provided
applicable disclosures. Past performance does not
guarantee future results or success. Consolidated
requires a $20,000 minimum investment.
Nevada MLD#284 – Consolidated Mortgage, LLC.
1291 Galleria Drive, Suite 220
Henderson, NV 89014
P. 702.739.9090/877.739.9094
Company Overview
• Founded in 1977
• Over $2 Billion in real estate
transactions closed
• Over $500 Million under
management
What is a Trust Deed /
Mortgage?
Definition of Trust Deed
Private Notes - Public Deeds
1st Trust Deeds Only
Types of Trust Deeds
• Land Acquisition
• Land Development
• Construction
• Bridge
Why Borrow from
Consolidated?
Speed
Flexibility
The Art of Choosing Good
Loans
• 5 C’s of Lending
–
–
–
–
–
Collateral
Capacity to borrow
Character of the borrower
Capital
Conditions of the market
• Fact Sheets
Risks Involved in Trust
Deed Investing
• Borrower Defaults
• Illiquid or Non-liquid
• No tax benefits for nonqualified funds
Why does a Trust Deed
belong in your portfolio?
Is your portfolio
diversified?
Growth vs. Income
(Example: 100 – Age = Growth Percent)
Fixed Income Bonds vs. Trust
Deeds
• Backed by company
issuing bond
• Backed by borrower
and collateral (real
estate)
• Interest paid monthly,
• Interest paid monthly
quarterly, semi-annually,
annually
• Maturity Dates vary
• Maturity dates typically
are 12 months
• Yield is traditionally
6 – 8%
• Yield is traditionally
12% and higher
• Secondary market
• No Secondary market
Fixed Income Annuity vs. Trust
Deeds
• Backed by Insurance • Backed by borrower and
collateral (real estate)
Company
• Typically interest
paid annually
• Interest paid monthly
• Maturity – Date of
death
• Maturity dates typically
12 months
• Yield is traditionally
3 – 5%
• Yield is traditionally 12%
and higher
• Tax deferred
• Tax deferred if
invested with IRA
Why is there an
opportunity to invest?
• State of the Market
– Credit Crunch
– Real Estate Bubble
• State of the Southwest
– Increasing Population
– Increasing Employment
Clark County Population
Southwest Regional Employment
Local Hot Spots – Las Vegas
The
Palazzo
Palms
Place
Capital: $1.6 Billion
Capital: $650 Million Expansion
Rooms: 3,025 suites
Rooms: 347 Condos
Opened: Jan. 2008
Opened: Feb. 2008
Encore
Capital: $1.9 Billion
Rooms: 2,045 suites
Estimated
Completion: 2008
This project will make
Wynn Las Vegas the
fifth largest hotel in
the world.
Echelon
Place
Capital: $4.8 Billion
The Plaza
Estimated
Completion: 2009
Rooms: 4,713
Estimated
Completion: 2010
Estimated
Completion: 2011
This construction
project is the most
expensive privately
funded in U.S. History
The Echelon will be
divided into five
partially separated
towers.
City Center
Capital: $8.4 Billion
Rooms: 6,650
Capital: $5+ Billion
Rooms: 4,100
Current plans are to
create a replica of the
ultra luxurious New
York namesake.
Have We Hit Bottom?
• Property Values
• Land, Development and
Construction
Why Lend in Today’s
Market?
• Lending Opportunities
• Credit Crunch
• Bank Quality Loans &
Borrowers
• Lending at the bottom
Example
2006 Value
2008 Value
2008 Loan
2008 LTV
$5,000,000.00
$3,000,000.00
$1,800,000.00
60%
Would you make this loan?????
What types of funds can I
use to invest?
• Money in checking and/or
savings account
• Roth IRA or IRA
• Corporate Funds
(LLC, Inc, etc…)
Benefits of Trust Deed Investing
•
•
•
•
•
Secured by Real Property
Short Term Commitment
Double Digit Annual Returns
Interest Paid Monthly
Portfolio Diversification
Thank you for attending
Q&A