As investors, many of us have been in a position of stumbling upon what we think is an excellent opportunity, only to then discover our funds are low. When this happens, there are three main options:
- Invest everything you have (even if it’s not as much as you’d like)
- Pass up on the opportunity to safeguard existing finances
- Seek out sources of additional funding
If you’ve come across a big investment opportunity and require some help stumping up the cash, then one of the following alternative finance sources could help.
Working off the basic model of lending money to family and friends but on a much larger scale, peer-to-peer lending (or P2P) offers a mutual benefit for lenders and borrowers. It works by the lenders putting their funds into an account which is then loaned out to borrowers, often with them able to choose who.
Investors can act as borrowers here, providing them with access to funds which can then be put towards that great investment opportunity. The lender benefits by setting repayment terms which will include interest. Therefore, if the investment you make is successful, not only will you benefit from its returns but so will the lender with the repayments you make.
Bad Credit Loans
A good credit rating will make P2P lending a lot easier, but if you have a poor one then using bad credit loans from Likely Loans could be a good solution. The repayment terms and costs are provided up front, so you receive full transparency.
It can be quick and easy to access the funds, so you shouldn’t miss out on any time-sensitive opportunities that crop up. Once the cash is in your account it can then be used as you see fit, and if your investment is successful then making all repayments should be simple.
Utilise Home Equity
For homeowners looking to free up some cash for a big investment opportunity, you may be able to use home equity depending on your circumstances. Home equity is the portion of your property you actually own, and you can take a lump sum out of it when and if required. Home equity loans also allow you to borrow against it for even higher cash amounts, though it can incur greater expenses.
These three alternative methods will provide you with different levels of finance to use for that fantastic investment opportunity, though each one contains an element of risk should it not be a successful venture.
While his background is mostly related to trading stocks, he recently gained interest in real estate crowdfunding with Fundrise.