Overall:
Platform Provided Due Diligence:
Platform Fees:
Quality of Deals:
Website - PeerStreet
Fees - 0.25%-1.00% interest rate spread for servicing
Phone - 844-733-7787
PeerStreet may apply a servicing fee on each loan offered for investment. The servicing fee is a “spread” between the interest peerpayable on a loan and the rate you receive as an investor. With this structure, the platform has aligned our interests with our investors as we will only get paid when our investors get paid. Generally, this fee will be in the range of 0.25%-1.00% and it will always be disclosed.
PeerStreet is a marketplace where an accredited investor can invest in high-quality private real estate loans. We provide access for accredited investors, funds and institutions to a historically difficult-to-access asset class.
These loans are generally secured by first liens on real estate. The company partners with top-tier originators across the country and carefully vets their loans before making an offering to our investors. Most of our loans are short in duration (6-24 months) with LTVs typically below 75%. The platform’s range of offerings provides investors the opportunity to build a diverse portfolio of loans across property type, geography, maturity, LTV, originator, among other characteristics.
In the event of a default, the company will handle the workout process and work on behalf of investors to protect their investment and maximize proceeds. Our in-house team has more than 97 years experience in residential and commercial real estate (average of 13 years per person), 52 years of law and 12 years of regulatory compliance, ensuring that the interests of our investors are protected at every stage of the default/foreclosure process. The platform also holds loans in a bankruptcy-remote entity that is separate from our primary corporate entity. In the event the company no longer remains in business, a third-party “special member” will step in to manage loan investments and ensure that investors continue to receive interest and principal payments. Additionally, investor funds are held in an Investors Trust Account with City National Bank and FDIC insured up to $250,000.
A real estate crowdfunding platform that provides real estate loan opportunities, PeerStreet has been funding real estate lending since 2014. Through February of 2020, it’s paid out more than $2.2 billion in principal and $175 million in interest payments to its investors. A total of $4 billion of lending, across more than 8,800 loans, have flowed through the platform in that time as well.
Every crowdfunding platform has its own benefits and drawbacks. Loans on PeerStreet are no different. Here are some advantages and disadvantages of investing through them.
Automated investment – Investors can choose a set of preferred investment criteria and allow the platform to do the rest. The platform automatically allocates uninvested capital into lending that are a match for an investor’s preferences. Investors have 24 hours to opt out of any automatic decision made as a safety feature, offering the best of both worlds when it comes to picking individual investment opportunities.
High number of investments – Every day, new investments are added to the platform. More than 8,800 loans have been funded through the company through February of 2020, showcasing the sheer volume of lending from which to choose.
Excellent historic performance– The platform’s track record has been excellent when it comes to its historic performance. Success rates are quite high over time, even when taking into account the occasional defaulted loan.
High transparency – The platform gets high marks for transparency. Not just does it reveal loan portfolio performance, but it also takes the time to explicitly state fees whenever applicable.
No investment funds – There are no packaged funds or loan bundles that you can avail yourself of through the platform if you’re looking for an all-in-one deal. That’s because the platform simply doesn’t offer investment funds. This doesn’t prevent you from making your own diversified portfolio on the platform, but you’ll be doing so by hand.
Debt investment only – There are no equity crowdfunding deals available through investing with the platform. Debt investment and hard money loans aren’t necessarily bad in and of itself, of course; it’s just not for anyone who wants to grow their principal.
Accredited investors only – Right now, this hard money investment platform offers no support for non-accredited investment activity. With this typical type of investor already well off, this eliminates a vast swathe of potential investors, leaving only the most well-heeled capable of using the platform.
PerStreet relies on a network of private lenders to source lending. These lenders are responsible for vetting potential borrowers and doing their own due diligence before listing them on the platform for investors to choose from. This is, essentially, allowing investors to act as the mortgage lender directly, providing the funds directly to borrowers while the company handles the paperwork. The platform does much of the nitty-gritty involved in the process behind the scenes, such as reviewing the background, financials, and history of any origination partners that want to join their network. The platform also does its own valuation and underwriting of every loan before offering it to investors.
The majority of lending on the platform are secured through first liens and have a maximum 75% loan-to-value ratio. This offers several protections to investors in the event of a default, helping to manage risk. The default rate on these loans is already low thanks to the platform’s due diligence.
Shorter-term in nature, loans from this company are what’s called “bridge loans”, which are specifically meant for home renovation projects. This type of lending is the favorite of house flippers that purchase a fixer-upper, renovate, and then resell on the real estate market to turn a profit. Loan durations start at 6 months at the shortest and 24 months at the longest.
As mentioned earlier, this company is only open to accredited investment activity. While this may change in the future, for the time being the platform’s hands are tied thanks to regulations from the SEC preventing it from opening its doors to everyone. This would be an excellent step, considering that the minimum loan investment is currently set at a quite manageable $1,000. Re-investment is even more affordable, with a minimum set at just $100.
Fee structures are unique when it comes to PeerStreet, as is common with many debt crowdfunding platforms. Servicing fees for each loan are embedded in the interest rate payments that borrower make to investors. Instead of an investor receiving the full amount of every payment, the company takes, in the form of a servicing spread, between 0.25 and 1 percentage points for themselves. These fees are very deliberately disclosed on the detail page of each loan, showing what lenders can expect. The platform charges other fees as well, such as origination fees for their loans. However, these fees are almost exclusively picked up by the borrowers. The only fee that has any impact on investors is this servicing spread.
When it comes to expectations on the rate of return for investors, these are inherently variable. Each loan is backed by real estate, and the individuals who borrow against these loans can have a range of credit profiles. Additionally, the length of the loan can also play a role in return values. PeerStreet makes it easy for investors to filter lending opportunities on the platform by expected return, however, which takes much of the guesswork out of the process. This is, of course, only in the event that the loan is repaid successfully.
It’s important to remember that there’s very little liquidity when it comes to debt investments, and real estate investments perhaps lack the most liquidity of all. You’re practically out of luck if you need to get your money back while the loan term is still running, as there’s no secondary market in existence for loans made through the platform. The good news is that PeerStreet lending is shorter-term. With loan terms of between 6 months and 24 months, you have the ability to choose how long your investment will be. This is one of the core advantages that debt investments have over equity investments, which can sometimes take upwards of 4 years to mature.
Peer-to-peer lending platforms carry plenty of inherent risk, especially when it comes to non-payment. It’s only natural that borrowers will occasionally find it difficult to repay their loans, which will result in interest payments drying up for investors. Thankfully, the company takes steps to back each of its loans by the real estate assets they’re tied to, which provides at least a base level of recourse in instances where borrowers run into financial difficulties.
The company handles the particulars of recovery in the event of a full default. A team of regulatory and legal experts go to work, right alongside its real estate team, to restore investors as completely as possible. This doesn’t completely erase risk, but it does mean that there is at the very least a solid plan in place to restore as much of your principal.
There are some solid advantages of using Peer Street to make real estate investments. The platform offers good support for any investor who wants to avoid equity investing and the risks that those types of investments bring. It also offers a cushion for anyone who prefers debt investment but doesn’t want to deal with loans that are unsecured in any way. The fact that investing with PeerStreet is backed up by an actual patch of land means that there’s plenty of recourse in the event of a default, and then helps mitigate risk by a major factor. Adding to the list of positives is the low minimum investment amount per loan, the sheer number of loans available to investors, the automated investing feature, and the shorter-term nature of fix-and-flip loans, which are paid back within 24 months or less.
At the same time, this investment platform is currently only available to investors who are accredited under SEC guidelines. This excludes a wide array of prospective investors interested in investing with Peer Street and the short term loans it offers. It’s a big lending club, but it’s one that isn’t going to include any but those that are already well-off and don’t have any skin in the game so to speak. This may change in the future, which will do nothing but increase this real estate investing platform’s favorability as a money-making investment platform. Until then, this is a great option for deep-pocketed investors only.
May 21, 2021
I don’t like Peerstreet either; however, I have suffered similar losses on loans through Patch of Land, Fund that Flip, Realty Shares, Yieldstreet, EquityMultiple, ifunding and LendingHome. The only similar platform on which I haven’t yet experienced this type of loss is ShareStates, and I still have several loans with them that may end up with big losses. After funding several hundred loans on these platforms, my conclusion is that it’s very difficult to avoid losses that drive your average return below 5%, and possibly even 0%. I would much rather invest in debt funds than in individual loans on one of these platforms.
May 21, 2021
Done with Peerstreet. I have like 5 loans late now. 2 as high as 120 days. For the low yield, lack of late fee payout, and poor quaility I am pulling out as they mature.
I contacted Blake and gave him a piece of my mind and told him I will tell the rest of my friends to do the same.
Sharestates and fundthatflip seem to be the 2 best debt locations.
Both are current and both pay out late fees and keep me updated.
I think peerstreet has gone the path of realtyshares and chosen fees and revenue over quality and due diligence!
Jul 24, 2018
This specific platform does not let you open several accounts under the same username which is annoying if you investing through llc’s and personally.
Otherwise deals seem to be relatively safe and abundant. Only 2 out of over 15 investments are late after over 2 years with them. The interest rates are lower than what I consider the risk factor for them, which makes this platform less attractive (on paper) than others.
Jun 13, 2018
Peerstreet was the first platform I invested with when I was less educated about the space. I am currently concerned about their model, that they buy debt originated by other Hard Money Lenders. Recently I had a property go to foreclosure which was a "fix and flip". The principals failed to complete the construction before running out of money. In addition they took out second level debt on the property. I think if there was a "cop on the beat" the construction funds wouldn't have been released without the lender monitoring the progress but since Peerstreet doesn't originate the loans I think they are less involved. I'm not investing there anymore.
Mar 12, 2018
I haven't had issues with Peer Street. The customer service reps respond very quickly. The return on the deals are on the lower end. But the platform is easy to navigate.
Feb 02, 2018
I have invested in 18 loans on Peer Street. 15 have paid off. Of the remaining 3 loans, 1 is current (but extended 2x), 1 is 90+ days late, and 1 resulted in a foreclosure.
I've yet to lose principal, but am interested to see how the remaining 3 loans pan out.
Overall, my expectations were higher. With yields on the low end, and 10%+ of my loans non-performing, I will not be making additional investments via Peer Street.
Nov 08, 2017
I have a couple deals with Peer Street. One is performing as planned and the other paid off a couple days ago. Seems like there should have been some communication about that. Certainly concur with the Auto-Invest comments, hence I don't do much with them. I like to look at the deals first. One big plus on Peer Street is they use current LTV as opposed to many I have seen that use ARV. Perhaps the A doesn't represent After but Astromical!
I usually like what I see however their yields are lower than I care to invest in.
Jul 07, 2017
Overall, no issues with peerstreet and the performane of notes there. But, the rates are getting lower and lower and it might be high competition in california for HML's. I have started to look at other options that would pay better rates.
Jun 08, 2017
I agree with many of the comments on here regarding relatively low returns and high competition for the higher performing notes and not having enough time to study the deals.
One of my loans has gone into default and Peerstreet has currently taken over the property and is trying to sell. No principals has been lost for me on the platform - yet.
Mar 18, 2017
I’m impressed with PeerStreet. I researched them for a couple of weeks and just recently their automatic system placed me into an investment (loan) that I’m very happy with. My first loan has an APR of 9.5% plus I get another 1% bump (because a friend gave me a referral link) for a total return of 10.5%. This investment has a low LTV of 61%, which I like.
I asked PS customer service what would happen to my principal $ if they went out of business and he replied "PeerStreet is set up as two companies. I work PeerStreet Inc. which is our operating company. It pays all the expenses of the business. We also have a bankruptcy remote special purpose entity called PeerStreet Funding LLC (PSF). PSF holds all the notes and its sole purpose is to service loans and pay interests and principle back to investors. If PeerStreet Inc. were to go out of business for any reason, a springing member would be activated (we pay a monthly premium for this, think of it as an insurance policy) who's sole responsibility would be to continue servicing the existing loans and return capital back to investors".
Feb 24, 2017
I've invested with PeerStreet for about 9 months now and haven't lost any principle yet. I've had a few loans that were late but the borrower eventually paid off the loan with late fees and interests.
As other investors have mentioned, I too find that the only way to get into the 10%+ deals is through auto-invest, and those have become far and few. I've also noticed a decreased in deal flows on the lower interests ones as well (perhaps this is more of a seasonal issue).
For now, I will continue to invest with them as the amount of capital I have with them is fairly small in the larger scheme of things. I just hope that as the gets bigger that it doesn't negatively impact their DD.
Feb 18, 2017
I liked Peerstreet platform, though the rates they pay are low. I also have found that as the popularity has grown I had to do auto-invest to get into deals. No complaints though with auto-invest, it works.
Overall, I think its a good platform though I wish they make it easier to review deals and get in. I hate feeling rushed to make a decision.
Feb 07, 2017
I have been investing with PeerStreet just under a year. They are highly rated and have a user friendly interface. They deal only with debt issues and are mostly single family homes. Yields are generally between 7 - 11% with the 10%+ category being in high demand on the platform. Their fees run at 1%.
An issue for me with PeerStreet is that if you want the higher yields, 10%+, you may not have time to study the offerings. The only way to get in on the higher yields is to auto invest. Auto invest is where you setup minimum parameters that you are willing to accept and then the system automatically places you in an offering that meets those parameters. You do have 24 hours to cancel your investment after you have been auto invested in an offering but that does not seem like a good methodology as that may not give you the time you need to look it over.
My experience has been that if I auto-invest, using 10% as a minimum return in my settings, I get in on every 2nd or 3rd offering. Technically you are on a waiting list though you do not see it. For the higher yields it is not possible to invest not using the auto invest feature because by the time you get the email of a new 10% offering it is already fully invested as everyone else seems to be auto investing. The 8% offerings hang around a bit before they are fully invested so plenty of time to study them.
PeerStreet claims no foreclosures which is reassuring, however I do have one position that has not paid since October of 2016. PeerStreet is good about adding comments as to the status when this occurs but they are not all that informative. Based on some of their latest offering I have been wondering if their desire to keep up with demand has weakened their standards and due diligence.
Overall I like the platform, it has an easy to use interface and it make it easy to monitor your positions. I do think the lower investment limits of the platform (I think it is 1K) brings in too many investors shortening the time you have to study the properties as they close almost immediately on the higher yield offers. It makes the whole process seem a little sloppy.
Jan 30, 2017
I had only 1 investment with PeerStreet. Borrower stopped paying for a couple months, but then paid off the note with expected late fees.
2 Concerns that discourage me from investing with PeerStreet in the future:
They buy notes from other originators and are completely dependent on those originators for service and information. PeerStreet reduces returns by 1% to investors, but passes on all risk.
It is extremely difficult to get any investment paying 10% or more unless you auto-buy. Auto-buy means no DD since PeerStreet automagically takes your funds when they post the note.
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Website - PeerStreet
Fees - 0.25%-1.00% interest rate spread for servicing
Phone - 844-733-7787
PeerStreet may apply a servicing fee on each loan offered for investment. The servicing fee is a “spread” between the interest peerpayable on a loan and the rate you receive as an investor. With this structure, the platform has aligned our interests with our investors as we will only get paid when our investors get paid. Generally, this fee will be in the range of 0.25%-1.00% and it will always be disclosed.
PeerStreet is a marketplace where an accredited investor can invest in high-quality private real estate loans. We provide access for accredited investors, funds and institutions to a historically difficult-to-access asset class.
These loans are generally secured by first liens on real estate. The company partners with top-tier originators across the country and carefully vets their loans before making an offering to our investors. Most of our loans are short in duration (6-24 months) with LTVs typically below 75%. The platform’s range of offerings provides investors the opportunity to build a diverse portfolio of loans across property type, geography, maturity, LTV, originator, among other characteristics.
In the event of a default, the company will handle the workout process and work on behalf of investors to protect their investment and maximize proceeds. Our in-house team has more than 97 years experience in residential and commercial real estate (average of 13 years per person), 52 years of law and 12 years of regulatory compliance, ensuring that the interests of our investors are protected at every stage of the default/foreclosure process. The platform also holds loans in a bankruptcy-remote entity that is separate from our primary corporate entity. In the event the company no longer remains in business, a third-party “special member” will step in to manage loan investments and ensure that investors continue to receive interest and principal payments. Additionally, investor funds are held in an Investors Trust Account with City National Bank and FDIC insured up to $250,000.
A real estate crowdfunding platform that provides real estate loan opportunities, PeerStreet has been funding real estate lending since 2014. Through February of 2020, it’s paid out more than $2.2 billion in principal and $175 million in interest payments to its investors. A total of $4 billion of lending, across more than 8,800 loans, have flowed through the platform in that time as well.
Every crowdfunding platform has its own benefits and drawbacks. Loans on PeerStreet are no different. Here are some advantages and disadvantages of investing through them.
Automated investment – Investors can choose a set of preferred investment criteria and allow the platform to do the rest. The platform automatically allocates uninvested capital into lending that are a match for an investor’s preferences. Investors have 24 hours to opt out of any automatic decision made as a safety feature, offering the best of both worlds when it comes to picking individual investment opportunities.
High number of investments – Every day, new investments are added to the platform. More than 8,800 loans have been funded through the company through February of 2020, showcasing the sheer volume of lending from which to choose.
Excellent historic performance– The platform’s track record has been excellent when it comes to its historic performance. Success rates are quite high over time, even when taking into account the occasional defaulted loan.
High transparency – The platform gets high marks for transparency. Not just does it reveal loan portfolio performance, but it also takes the time to explicitly state fees whenever applicable.
No investment funds – There are no packaged funds or loan bundles that you can avail yourself of through the platform if you’re looking for an all-in-one deal. That’s because the platform simply doesn’t offer investment funds. This doesn’t prevent you from making your own diversified portfolio on the platform, but you’ll be doing so by hand.
Debt investment only – There are no equity crowdfunding deals available through investing with the platform. Debt investment and hard money loans aren’t necessarily bad in and of itself, of course; it’s just not for anyone who wants to grow their principal.
Accredited investors only – Right now, this hard money investment platform offers no support for non-accredited investment activity. With this typical type of investor already well off, this eliminates a vast swathe of potential investors, leaving only the most well-heeled capable of using the platform.
PerStreet relies on a network of private lenders to source lending. These lenders are responsible for vetting potential borrowers and doing their own due diligence before listing them on the platform for investors to choose from. This is, essentially, allowing investors to act as the mortgage lender directly, providing the funds directly to borrowers while the company handles the paperwork. The platform does much of the nitty-gritty involved in the process behind the scenes, such as reviewing the background, financials, and history of any origination partners that want to join their network. The platform also does its own valuation and underwriting of every loan before offering it to investors.
The majority of lending on the platform are secured through first liens and have a maximum 75% loan-to-value ratio. This offers several protections to investors in the event of a default, helping to manage risk. The default rate on these loans is already low thanks to the platform’s due diligence.
Shorter-term in nature, loans from this company are what’s called “bridge loans”, which are specifically meant for home renovation projects. This type of lending is the favorite of house flippers that purchase a fixer-upper, renovate, and then resell on the real estate market to turn a profit. Loan durations start at 6 months at the shortest and 24 months at the longest.
As mentioned earlier, this company is only open to accredited investment activity. While this may change in the future, for the time being the platform’s hands are tied thanks to regulations from the SEC preventing it from opening its doors to everyone. This would be an excellent step, considering that the minimum loan investment is currently set at a quite manageable $1,000. Re-investment is even more affordable, with a minimum set at just $100.
Fee structures are unique when it comes to PeerStreet, as is common with many debt crowdfunding platforms. Servicing fees for each loan are embedded in the interest rate payments that borrower make to investors. Instead of an investor receiving the full amount of every payment, the company takes, in the form of a servicing spread, between 0.25 and 1 percentage points for themselves. These fees are very deliberately disclosed on the detail page of each loan, showing what lenders can expect. The platform charges other fees as well, such as origination fees for their loans. However, these fees are almost exclusively picked up by the borrowers. The only fee that has any impact on investors is this servicing spread.
When it comes to expectations on the rate of return for investors, these are inherently variable. Each loan is backed by real estate, and the individuals who borrow against these loans can have a range of credit profiles. Additionally, the length of the loan can also play a role in return values. PeerStreet makes it easy for investors to filter lending opportunities on the platform by expected return, however, which takes much of the guesswork out of the process. This is, of course, only in the event that the loan is repaid successfully.
It’s important to remember that there’s very little liquidity when it comes to debt investments, and real estate investments perhaps lack the most liquidity of all. You’re practically out of luck if you need to get your money back while the loan term is still running, as there’s no secondary market in existence for loans made through the platform. The good news is that PeerStreet lending is shorter-term. With loan terms of between 6 months and 24 months, you have the ability to choose how long your investment will be. This is one of the core advantages that debt investments have over equity investments, which can sometimes take upwards of 4 years to mature.
Peer-to-peer lending platforms carry plenty of inherent risk, especially when it comes to non-payment. It’s only natural that borrowers will occasionally find it difficult to repay their loans, which will result in interest payments drying up for investors. Thankfully, the company takes steps to back each of its loans by the real estate assets they’re tied to, which provides at least a base level of recourse in instances where borrowers run into financial difficulties.
The company handles the particulars of recovery in the event of a full default. A team of regulatory and legal experts go to work, right alongside its real estate team, to restore investors as completely as possible. This doesn’t completely erase risk, but it does mean that there is at the very least a solid plan in place to restore as much of your principal.
There are some solid advantages of using Peer Street to make real estate investments. The platform offers good support for any investor who wants to avoid equity investing and the risks that those types of investments bring. It also offers a cushion for anyone who prefers debt investment but doesn’t want to deal with loans that are unsecured in any way. The fact that investing with PeerStreet is backed up by an actual patch of land means that there’s plenty of recourse in the event of a default, and then helps mitigate risk by a major factor. Adding to the list of positives is the low minimum investment amount per loan, the sheer number of loans available to investors, the automated investing feature, and the shorter-term nature of fix-and-flip loans, which are paid back within 24 months or less.
At the same time, this investment platform is currently only available to investors who are accredited under SEC guidelines. This excludes a wide array of prospective investors interested in investing with Peer Street and the short term loans it offers. It’s a big lending club, but it’s one that isn’t going to include any but those that are already well-off and don’t have any skin in the game so to speak. This may change in the future, which will do nothing but increase this real estate investing platform’s favorability as a money-making investment platform. Until then, this is a great option for deep-pocketed investors only.
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