streetwiseprivatecapita

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Private mortgages and private money can offer attractive returns to investors, but as with any investment strategy, it comes with risks. The key is to understand these risks and learn how to mitigate them. The first risk to consider is the property risk. It is crucial to evaluate the value and condition of the property, and the zoning and loan-to-value ratio. It’s also important to consider the market the property is in and how quickly it might sell if it goes into power of sale. Another risk is market risk, as smaller and remote markets might limit the ability to sell the property. The third risk is the borrower’s risk, including their ability to service the loan and whether they owe any taxes. Finally, it’s important to assess the exit strategy, as it is crucial to exit the deal and get the private loan paid back by the end of the term.