Passive investing with peer street

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CouchFI is all about making money no matter where you are in the world, so a big part of my financial independence strategy is passive investing i.e. making money regardless of where I am and what I'm doing - in my case sitting on a couch. Online crowd funded real estate investing recently caught my attention and one of the first platforms I tried was PeerStreet.

Peer street is a peer-to-peer lending platform for short term realestate backed loans. Because the loans are backed by a physical property, I consider it safer than other types of peer to peer investing such as lending club. Most peer street offerings are first lien loans which means that if the lender defaults and their property is sold as collateral, you as an investor are first in line to be paid back, ahead of other borrowers as well as the lender.

That's not to say that it's risk free. There are a few risks to keep in mind if the borrower defaults:

However, being a first lien loan holder mitigates some of the risks of losing money, and PeerStreet has some qualities that I really like:

As of today (Nov 5, 2018) I've invested $5000 into peer street to test out the platform. I might put another 5 - 10k in a few months when I have more cash available and don't find investments with better risk adjusted returns. Check back here in a year and I'll tell you how my investments are doing.

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