Following the global financial crisis, many people abandoned two previously popular sectors of investment, real estate and financial markets. While the recovery phase is on, many are still weary on investing. The good news is that there is another outlet for your investment with lower risks than before while also providing higher returns. This new area is P2P investing.
Real estate peer-to-peer lending provides those seeking financing of commercial real estate projects and other investment properties with the loans. The loans are provided as either secured P2P loans or unsecured P2P loans. They are preferred since they attract low interest rates while at the same time being easy for qualification while secured P2P loans have collateral to protect a lender’s investment. There are several reasons why investing in P2P is attractive and beneficial. They include the following:
1. High and steady returns at low risks
When compared to other forms of investment, P2P investments are the only ones which combine high returns with little accompanying risk. All the while the income flows at a steady pace. An investor profits from interest rates charged on the loans with unsecured loans attracting higher interest rates. The interest rates are less volatile thus little or no fluctuation on the income you receive.
2. Choice of investment
Unlike other investments, in P2P you have a choice on what to invest in according to your own assessment. You can also diversify your investments. This provides you with control on the investments while also allowing you to mitigate your risks.