Discounted Debt Investments (DDI’s) are opportunities created through what are known as non-performing loans. These are an alternative class of assets that have the potential for high returns. For decades, some of the most well known investment management companies have generated profit for their clients from these loans, so we’re delighted to be able to offer them to the Indemo Community!
Investing in Discounted Debt Investments
Simply put, DDIs are created out of loans in which the borrower has failed to make payments on. Lenders like banks will often sell these loans on the market at a significantly discounted price, including the real estate asset attached to them. The loan products are sourced from high street Spanish banks, and offer you an opportunity to invest in them at the discounted rate. Once the attached real estate is sold for its market value, you can make a healthy profit. This class of assets are frequently traded by some of the biggest and most successful investment banks. The risk attached to this product is higher than our Mortgage Loan Investment products, but the returns generated can be much bigger.
Here’s how it works
Non-performing loan goes on market
Banks put the loan on the market at discounted prices. Our partners in Spain pick the most attractive loans for us, and we make them available to you on Indemo.
Pick and invest!
We combine a number of these loans into a Stack of Notes — providing diversification and more regular returns on your investment. Investing in Notes means you take on exposure to both the risk and returns of the DDIs.
You earn returns
Once the real estate attached to the loans are sold at the market value, you will be entitled to a portion of the profits.
Advantages of Discounted Debt Investment Products
All DDIs products are backed with bank quality mortgages as collateral.
Almost all of the loans are for secondary residences. This means easier enforcement and precise market valuations conducted by independent appraisers such as Tinsa and Idealista
You’re entitled to proceeds from the sale of the property, typically providing two digit returns in 12-18 months.
All DDIs we offer originate from Spain, an EU and Eurozone Member State with a stable, predictable legal and political climate. This means lower market volatility.