A Guide to Investing in Trust Deeds

A Guide to Investing in Trust Deeds

Before you commit to a trust deed (TD) investment, please ask yourself:

  • “What are my safety goals”?
  • “Does this TD investment have the right level of yield, borrower credit, borrower income and/or remaining equity protection to meet my goals?”
  • Are deficiencies, if any, in the borrower’s credit history or income offset by an adequately reduced loan to value ratio in order to provide additional protective equity?
  • Do I have confidence in the appraised value?
  • What can I do to verify the approximate value?
  • What’s the “risk reward ratio?” Does the yield offset the apparent risks?  If not, don’t make the investment.
  • Are my investments clustered too close together? In other words, do I have too many investments on the same earthquake fault line?
  • Do I want the entire loan or do I wish to have greater diversification by investing in smaller portions of many different loans?
  • What is the exit strategy if I/we foreclose on and acquire the underlying property

Next, think about the obvious, uncontrollable risks:

  • Natural disasters or terrorist attacks.
  • Property value fluctuations with the market cycles and other influences.
  • The effects of Federal, State or local legislation or court decisions affecting TD investments.
  • What about deflation?
  • What about inflation?
  • How many of these risks can I accept when weighed against the balance of my portfolio?

Then please consider:

  • Is this a loan being brokered into your name or has the loan been prefunded prior to offering to you?  Has the original lender enough confidence in the loan to fund it with its own money?
  • Has the original lender enough confidence in the loan to fund it with its own money?
  • What degree of diligence and compliance has been applied in underwriting and processing this loan? Can I view the loan file to determine diligence level if I wish?
  • Can I view the loan file to determine diligence level if I wish?
  • What is the capability and experience of the company designated to service my loan?


  • Do I want the convenience and diversification of the RCTC Diversified Mortgage Fund, LLC as opposed to individual TD investments.

Why R. C. Temme Corporation?
For a number of reasons, most TD investors feel safer investing in loans secured by owner-occupied single family homes.  R. C. Temme Corporation is currently one of the very few companies in California who routinely offers TD investments secured by owner-occupied homes.  R.C. Temme Corporation also offers TD investments secured by many other property types. Here are more reasons to think about doing business with R.C. Temme Corporation:

  • We’ve served investors from the same location since 1976.
  • We have 16 carefully screened and highly trained employees in addition to input from employees of our separate but affiliated company.
  • Included among R.C. Temme Corp. employees are an in- house attorney, two doctorates, at least four masters degrees, including three MBAs and other degreed and/or highly capable professionals.
  • For your TD investments, a critical appraisal review process takes place.
  • We participate with our originating affiliate in a five to seven person loan committee that “picks apart” every loan considered for approval. We subject each loan to various tests and numerous checklists – all with an eye towards regulatory compliance and a critical analysis of the risk and safety factors.
  • We have independent quarterly CPA reviews of our loan service trust accounts, filed with the state and available to you, our clients.

If you have questions about TD investing please call and ask for Gail Fortier 818-999-2274 or 800-827-5626.


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