For most clients who invest in mutual funds or stocks, there is very little control over your investment. You are generally a small cog in a big wheel, along for the ride regardless of where it goes. By investing in offshore mortgages however, you take complete control over your offshore investments.
By becoming your own mortgage lender in the Caribbean, you not only take control of where your funds are invested, but you also cut out the middle man (the banker), meaning your return is your actual return. The administration costs of mutual funds often make them unprofitable, not keeping up with the cost of inflation.
Our mortgage lenders generally make approximately 8% return on their low risk loans. They decide who to lend to, where to lend and how much risk they want to take on the loan (loan to value usually does not exceed 50%).
Not only is it easy to become a mortgage lender, but it is far more common than you may think. There are not that many places to invest your money in the Caribbean that will give you this type of return with so little risk.
If you want to become a lender, you will have to have your funds set aside for a significant amount of time. Most borrowers will want the ability to renew the mortgage after a year. There will be no ability for you to simply call your funds at any point, unless the mortgage is up for renewal and you have given the borrower ample time to find alternative funding.
As we saw in 2009, markets can have dips. If there is a problem and you had to foreclose on someone, it can take time. This is why we don’t recommend lending over 50%, as this gives you plenty of cushion to absorb any drops in market value.
Talk to us today about our mortgage investments to see if they make sense for you and your situation. We can give you all the advice on the pitfalls to watch for and assist you in finding borrowers.