My EstateGuru portfolio after 5 months
5 months ago, I’ve added some funds to my EstateGuru account and then forgot about them. Today I’m rich. This is my story.
Wouldn’t that look nice as a headline? The truth is, I only added a relatively small amount to my account and the investments available have normal interest rates, around 10% to 12%. Nothing that would make me a millionaire in 5 months.
EstateGuru is a crowdlending platform that finances real-estate development loans or business loans backed by property. If you want to learn more about EstateGuru you can check out my review here.
What I’ve been investing in
I’ve added to my account 1210 EUR at the beginning of August. Being an experienced p2p lending investor, I carefully selected and invested in all the loans available at the time on the platform.
So, my portfolio consists of 8 investments:
- 4 bridge loans
- 2 business loans
- 1 development loan
- 1 refinancing loan
Each loan has all sorts of details regarding the borrower, collateral, payments schedule. Of course, I didn’t read any of it.
Because I didn’t know at the time, I learned meanwhile what each loan type actually means.
A bridge loan is a type of short-term loan backed by property. The loan is usually issued in 5-14 days, which is a lot faster than other types of loans. As a downside, they’re more expensive than traditional mortgages. Typically, companies choose a bridge loan when they need cash quickly, for example when buying a property at an auction or buying something under the current market value.
Most of the times, bridge loans are offered for 1 to 18 months, and there are no repayments until the end of the loan term.
Out of the 4 bridge loans I’ve invested in, 2 of them have monthly payments scheduled, and the 2 others are going to be paid in full at the end of their 9 months loan term. I’ll get 40 EUR interest on them at the end of next August. Until then, nothing.
The business loans EstateGuru offers are for small businesses that need to increase their operating capital. These loans are also secured by real estate property on the platform, and the interest rate is paid back on a monthly schedule.
That’s an easy one. All loans used to develop real-estate property are development loans. The only development loan I’ve invested in has been so far late with the payments in 3 of the 4 months.
A refinancing loan is a loan made to pay off another loan. Companies (and individuals) do this in order to get a better loan deal: either lower interest rate, or lower payments, or to shorten the loan term, or just pay off a loan that was due at a specific date.
The loan I have in my portfolio needs to pay the interest only at the end of the loan term, so I’m not getting any monthly payments for this one either.
How are my investments doing
Out of the 8 loans I’ve invested in, only 5 of them pay monthly instalments. I’ll keep this in mind next time I’m investing. It’s always good to check out the payment schedule.
In total, I’ve received 26.44 EUR in interest payments so far. The loans I have in my portfolio that don’t pay monthly interest really mess up with my account statistics. The average interest rate of all my investments is at 10.84%, so I’ll assume that’s what I’ll gain when the loan terms end.
I like EstateGuru so far. They constantly have new loans to invest in and all loans are secured by real estate property.
I wish I learned more about the loans at the time I started on the platform. If I’ll add more capital to it, I’ll sure pay more attention to the loan details.
If you plan to open an account on EstateGuru, use my referral link and get a 0.5% bonus on all your investments done in the first 3 months.