Available asset types
Real estate investing can be tough to crack due to its typically high stakes. This is where PeerStreet comes in. Calling itself a real estate investment platform, PeerStreet extends the peer-to-peer marketplace into real estate lending for investors who have a high enough net worth to be accredited.
Investing in real estate is both tricky and expensive. And while PeerStreet works toward a more comfortable process, it’s not exactly open to the first-time investor.
For starters, you’ll likely need to know a little about real estate lending to even understand how PeerStreet works. You’ll also need to be an accredited investor with a net worth of at least $1 million or an income of $200,000 a year. That’s a lot of beans.
Unlike many other investing platforms, PeerStreet gives you access to its “curated” (its word for vetted) properties or borrowers for as low as $1,000 a pop. You’ll get to choose your interest rate, loan-to-value percentage, terms and investment per loan. And after you invest, PeerStreet makes it easy to track investment results while keeping up on industry news.
By setting up the automatic investments option when setting up your portfolios, PeerStreet automatically connects you with real estate opportunities based on your preferences. Once a connection is made, you have 24 hours to review and cancel if you aren’t interested.
Unlike directly investing in real estate, your PeerStreet investment doesn’t mean taking on the hassle of owning a property. Instead, with your investment you’re one of many passive lenders who become limited partners in a high-yield loan — one you may not have had access to otherwise.
Other benefits include:
As with most investments, you’ll pay a servicing fee on each loan you invest. With PeerStreet, your servicing fee can range from 0.25%% to a hefty 1.00% of your loan.
A few other potential drawbacks with PeerStreet include:
Resoundingly, yes. PeerStreet protects your transactions with industry-standard SSL/TLS encryption, and it stores your personal and financial data in an Amazon Web Services–powered data center. It routinely tests its hosting services for vulnerabilities to keep up with state-of-the-art compliance.
On the investment side, PeerStreet holds its loans in a single-purpose entity separated from its corporate entity. Investor funds are held in a trust account that’s FDIC insured for up to $250,000.
PeerStreet user reviews are rare, but the few we found were generally positive. Although PeerStreet is not accredited by the Better Business Bureau (BBB), the organization gave it an “A” rating. Reviews on Reddit were mostly mixed. Positive reviews mentioned reasonable returns. But two negative reviews involved borrowers who stopped paying back their loans. One negative review mentioned that their issue was eventually resolved and the user got principal and interest paid within 10 months. But you may want to carefully analyze the risks involved when using PeerStreet or other platforms that let you invest in real-estate backed loans. When you invest in loans, you run the risk of the borrower defaulting. The interest rate environment at any given time can also affect your returns. Examine the provider’s history and vetting process for loans on its platform to get a taste of what you can expect. But keep in mind, this doesn’t dictate its future.
Founded in 2013 by a team of attorneys and an ex-Google executive, PeerStreet is an intuitive crowdfunding platform focused on private real estate lending. With PeerStreet, you invest a minimum of $1,000 toward loans that range from six to 24 months. Not that there’s one typical loan with PeerStreet — instead, you can build a portfolio you’re comfortable with across properties, locations and maturity levels.
PeerStreet thoroughly vets borrowers — called “origination partners” on its site — using background, financial, legal and licensing reviews. And its experienced team examines each potential loan with a series of proprietary analytics, independent appraisals and documentation reviews designed to help its customers sleep tight.
And sleep tight, they have: As of October 2017, PeerStreet has helped fund some $500 million in loans with zero losses through its innovative platform.
To open an account with PeerStreet, you must be at least 18 years old and an “accredited investor” with a net worth of at least $1 million or an individual annual income of $200,000 or more ($300,000 or more for joint investors) for the past two years.
Among other documentation required at the discretion of PeerStreet, you’ll need to submit:
To create an account with PeerStreet:
1. Go to PeerStreet’s website and click Get Started.
2. Create an account by first entering your name, email address and password to log in to your account in the future.
3. Choose the account type you’re interested in.
4. Enter your state of residence and phone number, and then complete your income assessment — either as an individual or joint investors with another person. Add your net worth and click Continue.
PeerStreet opens up real estate opportunities to those who may not have the resources to become major property players but are still looking to get their feet wet — and maybe build up a little nest egg in the process.
A low minimum investment is a plus, but eligibility rides on your ability to prove that you’re an “accredited investor,” which comes with high net worth or annual income requirements.
Available asset types
Ark7 Real Estate Investing
Available asset types
Finder rating 3.5 / 5
Available asset types
Real estate, Art, Other
finder.com is an independent comparison platform and information service that aims to provide you with the tools you need to make better decisions. While we are independent, the offers that appear on this site are from companies from which finder.com receives compensation. We may receive compensation from our partners for placement of their products or services. We may also receive compensation if you click on certain links posted on our site. While compensation arrangements may affect the order, position or placement of product information, it doesn't influence our assessment of those products. Please don't interpret the order in which products appear on our Site as any endorsement or recommendation from us. finder.com compares a wide range of products, providers and services but we don't provide information on all available products, providers or services. Please appreciate that there may be other options available to you than the products, providers or services covered by our service.