1. A stock’s value fluctuates constantly. A trust deed’s value is always fixed and stable.
2. A stock is typically backed up by a conglomerate of equipment, property or services, sometimes outside the US. A trust deed is collateralized by real estate within the US, most often by homes or property within the investor’s local area.
3. A stock owner is in third position (behind bondholders and preferred stockholders). A trust deed owner is usually in first or second position.
4. A stock broker charges a fee to every investor, while your trust deed broker usually charges no fees to you.
5. A stock either pays no dividends, or pays dividends well below the prime interest rate. A trust deed pays well above the prime rate.
6. A stock’s dividend payments to you may be legally halted at any time by a board of directors. Trust deed payments can never be legally halted (even if the person files for bankruptcy, your interest clock keeps ticking!).
7. A stock’s price is fixed at a given point in time. You cannot negotiate with the Seller. A trust deed’s price is open to negotiation between you and the seller.
8. A stock’s value is dependent upon forces which the investor has not control over (other people’s actions). Typically, the trust deed is well secured and largely predictable.
Please call Michael Cushner for more information – (760) 845-9035!