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Investor Information (Full Letter)

Introduction to Trust Deed Investments                                      

Persevere Lending (PL) is a California Corporation, specializing in the brokerage of privately funded mortgage transactions for real estate in Northern California, primarily in the greater Bay Area. Trust Deed investing, also known as “private” or “hard” money, is a niche alternative investment vehicle which offers an attractive return with the security of a Deed of Trust lien on the real estate collateral. Various types of collateral include; single-family residential, all types of commercial, and improved land.  This form of real estate lending is considered non-conventional, as it is not administered or serviced by a traditional lending institution or bank.  Rather, the beneficiaries of the loans are private individual investors.  PL acts as the intermediary between our investors and borrowers and is the subsequent servicer of the loan. 


PL solicits loan requests directly from individual or entity borrowers. We are also inundated with referral submissions. Referral sources include wholesale mortgage brokers, retail mortgage bankers, and Realtors, who represent individual and entity borrowers. A portion of our clients have experienced traumatic economic distress which has affected their credit rating and ability to borrower money from banks. We can assist these borrowers on a case-by-case basis as long as the loan we are providing them is on an extremely low-leveraged property, based on a conservative valuation. This is truly equity or collateral-based lending. A much larger percentage of our borrowers are extremely credit-worthy and financially sound. They have historically good credit and verifiable assets and reserves. However, they have a unique or time-sensitive funding request that falls out of the box of traditional banking guidelines or capacities. In today’s credit strapped environment there are countless borrowers who deserve a loan by any qualifying standards, but are being shut out by banks who are either unwilling or unable to lend them money. This is the target borrower for PL ; a borrower who has demonstrated fiscal conscientiousness and responsibility, has a defined purpose for and use of the loan proceeds, and has a clear and plausible exit/payoff strategy.


PL maintains very rigid underwriting guidelines which serve as safeguards for the transaction and mitigates as much of the risk as possible. While no investment is completely devoid of risk, PL feels confident that our rigorous and comprehensive due diligence will continue to reap us an extremely high success ratio. Underwriting factors include but are not limited to; equity protection (LTV), location of collateral, market trends in the collateral’s vicinity, physical condition of collateral, financial condition and history of borrower, debt service capacity of borrower, and exit strategy. In some cases we impose very strict interest reserves, sales provisions, or step-up interest rates in order to assure our investors maintain a consistent stream of interest income and that the debt is satisfied by or before the scheduled maturity date.


While we can go as high as 75%, typical leverage of our transactions is only 60% of the value of the underlying collateral. Typical terms of our loans are 12 to 24 months, with an average life of approximately 10 months.  Since 2008 our investors have consistently enjoyed an average return of approximately 9.5% per annum. The percentage of loans that have resulted in loss of investor capital from 2007 through 2016 is 5%.  However, the vast majority of the investments that resulted in a loss or default took place in 2007 and 2008 during the worst housing and financial market collapse in decades, and arguably in history. Many of these loans were originated between 2006 and 2007 during the previous peak of the real estate market. Many of our collateralized properties were in markets that depreciated 40%, 50%, or even 60%. Despite our best and most concerted efforts, it is next to impossible to prepare for or defend against such a cataclysmic economic downturn, that we are only now beginning to recover from. From 2010 through 2016 only 1% of our loans has resulted in capital loss.


We encourage you to call us at your earliest convenience to discuss private Trust Deed investing in more detail.  We can explain how you can enjoy tax-deferred interest income. We can also show you how even if a deal goes bad, you most likely will not lose a penny of your capital and you may actually make much more in the end. Ideally we would like to set up a time to meet with you in person to review and answer any questions you may have. While Trust Deed investing is extremely profitable with substantial upside potential, there are inherent risks, as is the case with any investment. We want you to be fully aware and knowledgeable of these risks and of the recourse methods we have to deal with and mitigate these risks. The security of our investor’s capital is a top priority, which is why we have developed such a comprehensive due diligence process, as well as aggressive and effective loan servicing techniques.  Rest assured, the investment opportunities PL presents to you have been thoroughly vetted including; site inspection and market analysis, guarantor interviews and investigation, credit and financial reviews, and exit strategy feasibility. While nobody has a crystal ball, and we certainly will not pretend to know what will happen in the future, we do believe that there are trends in the market, both historical and current, that suggest that investing in real estate remains a secure and profitable investment option.


We look forward to opening the door for you to the lucrative world of private Trust Deed investing.




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