4 ms·

You don’t want to be the “Bank” with only one note tying up a large percentage of your capital. Just ask Donald Trump.

• toomuchtodo 8y ago
  You do if you need the risk adjusted return and can’t get it elsewhere.
  • dymk 8y ago
    I suppose that’s fine if we’re agreeing it’s a last ditch effort
    • toomuchtodo 8y ago
      Jack Boggle and others have stated you’re not getting above 5 percent risk adjusted returns in the public markets over the next decade at least. You can realize 7-10% returns making a note seller financing. I would assume we’re already of the understanding a last ditch effort is necessary to obtain necessary returns.
  • URSpider94 8y ago
    I think the issue is diversification. Carrying the note for a buyer can be a decent idea for a developer who owns 100 properties, but probably not if the loan represents 50% of your assets. Calculations like "risk adjusted return" start to fall apart when you get out of continuous statistics and into single-event probabilities ...