An Introduction to Private Credit Investing

Private credit investing is quickly emerging as one of the most attractive and profitable investment opportunities today. It offers many advantages to investors, including low risk, high returns, and diversification benefits. We've compiled rankings that provide an overview of the top private credit investments available today – from traditional debt offerings to equity investments in cutting-edge technology companies. With our guide, you'll have all the information you need to get started with your private credit portfolio and reap lucrative profits while avoiding unnecessary risks.

Fundrise

Fundrise is a real estate investment platform founded in 2012 that provides investors access to private markets across the United States. Fundrise has over $2 billion in assets under management (AUM), and specializes in commercial, residential, and development projects.

Investors can choose from pre-built portfolios or customize their own portfolio by handpicking individual investments. Each of these investments are eREITs (electronic Real Estate Investment Trusts) which provide diversification across different asset classes like office buildings, retail centers, apartments, etc. There is no minimum to open an account or invest.

The pros of investing with Fundrise include low fees compared to traditional REITs (0% - 0.85%), access to exclusive deals not available on public markets, and professional guidance from experienced advisors who manage the portfolio for you. The cons include lack of liquidity since most investments have a 3-5 year lockup period before they can be sold back into the market; also there are certain fees associated with withdrawing your money early if needed.

Yieldstreet

Yieldstreet is a digital investment platform founded in 2015 that enables investors to access unique alternative investments with low minimums and high yields. It has over $2 billion in AUM and provides access to asset classes such as real estate, art, legal finance, marine finance, and more.

Yieldstreet offers a variety of products for both accredited and non-accredited investors. These include private debt funds, equity deals on commercial real estate projects, litigation financing opportunities from law firms around the world, short-term loans backed by luxury cars or boats, and more. The platform also allows users to diversify their portfolios with fractional ownership of items like fine art.

The main advantages of using Yieldstreet are its low minimums ($1k), competitive returns (up to 15%+ APY), and no fees for investing or withdrawing money from the platform. However, there are risks associated with these types of investments including illiquidity risk which means you may not be able to exit your position quickly if needed. There may be other fees associated with specific investments so it's important to read through all documentation before investing.

PeerStreet

PeerStreet is a real estate investment platform founded in 2013 that allows investors to purchase fractional shares of private loans secured by real estate. It has over $2 billion in AUM and offers investments with returns up to 12%.

PeerStreet provides an array of products, including fix-and-flip loans, rental property loans, bridge loans, and more. Investors can browse the available investments on the website and select ones that meet their criteria based on loan type, location, term length, interest rate etc. Once selected investors can add funds to their account via ACH transfer or wire transfer from a bank account.

The main benefits of PeerStreet include higher yields than traditional fixed income options such as bonds; short terms ranging from 6 months to 36 months; low minimums ($1k); no fees for buying or selling; and diversification across multiple properties within one loan portfolio. On the other hand there are risks associated with investing in individual notes such as default risk if borrowers fail to make payments or market risk due to changes in local housing markets.

Crowdstreet

Crowdstreet is an online investment platform that provides accredited investors with access to commercial real estate investments. Founded in 2014, Crowdstreet currently has over $1 billion in AUM and offers a wide variety of products and services such as direct investing, co-investing, and fund investing.

Through Crowdstreet's platform, investors can browse the company's marketplace for vetted commercial real estate opportunities that fit their individual criteria. Once they have identified an opportunity they are interested in pursuing, they can review detailed information on the property or portfolio before making an informed decision about whether or not to invest. Investors can also take advantage of Crowdstreet’s suite of tools which provide insights into market trends and performance metrics.

The main pros associated with using Crowdstreet include its broad selection of properties available for investment along with its user-friendly interface which makes it easy for new users to navigate the platform quickly. The primary con is that there are high minimum investments required; most projects require at least $25-50k upfront while some even go as high as $250k+. Fees vary depending on each project but typically range from 1%-2% annually plus any additional fees charged by third parties involved in the transaction.

LendingClub

LendingClub is an online peer-to-peer lending platform founded in 2006 that facilitates borrowing and investing between individuals and businesses. As of May 2020, LendingClub has facilitated over $50 billion in loans with over 2 million members worldwide.

At its core, LendingClub allows borrowers to apply for a loan from individual investors who are looking for higher returns than traditional investments offer. Borrowers can select the amount they need, their desired repayment term (36 or 60 months) as well as the interest rate they’re willing to pay for the loan. Investors then review these applications and decide which ones to fund based on criteria such as credit score, income level and debt-to-income ratio.

The pros of using LendingClub include competitive rates compared to banks or other lenders; no prepayment penalty; fast funding times; ability to track payments via user friendly dashboard; automatic payment options available; transparent fees with no hidden charges. The cons include high minimums – most investors must have at least $2,500 before being able to invest in notes through their platform – plus origination fees ranging from 1% - 6%, depending on the borrower's creditworthiness.

Supervest

Supervest is a global investment platform, founded in 2020, with over $50 million in AUM. It offers investors access to exclusive venture capital and private equity deals that were previously only available to institutional investors.

Supervest allows users to invest directly into companies or funds through its online platform. It provides an easy way for individuals to diversify their portfolios by investing in early-stage startups and venture capital funds from around the world. Users can also choose different types of investments such as real estate, debt financing, cryptocurrency, and more.

The pros of Supervest include low minimums ($1k) with no hidden fees or lockup periods for investments. It gives users access to pre-vetted opportunities that are usually reserved for large institutions. The cons are that it requires a high level of due diligence on the part of the investor since they will be investing directly into companies without any intermediaries involved.

Prosper

Prosper is an online marketplace for personal loans founded in 2006, and has since grown to become one of the largest players in the industry with over $7 billion in AUM.

Prosper offers a peer-to-peer lending platform that connects borrowers seeking unsecured personal loans with investors looking to earn returns on their investments. Borrowers can apply for up to $40k at rates as low as 5.99%, while investors can invest from just $25 and benefit from competitive returns.

The primary pros of using Prosper are its competitive interest rates, high loan amounts, fast funding times (as quick as 1 business day) and no prepayment penalties or hidden fees. The main con is that it only serves US customers; however, there are minimum requirements which include having a credit score of 640 or higher and a debt-to-income ratio below 50%. There are also origination fees ranging from 2% - 5% depending on the borrower's credit profile.

Percent

Percent is an automated investment platform that was founded in 2019 to help people get started investing with as little as $5. It offers a variety of low-cost, diversified ETF portfolios and has more than $100 million in AUM.

Percent provides users with access to professionally managed portfolios tailored to their individual goals and risk preferences. Users can set up automatic deposits from their bank account or use the mobile app for one-time investments. They also offer tax-loss harvesting, which helps investors reduce their taxable income by taking advantage of market volatility.

The main advantages of using Percent are its low fees (0.25% annually), no minimums, and user-friendly interface. On the downside, it does not offer fractional shares or any other advanced features like retirement accounts or margin trading capabilities. There is no human advisor support available so you may have difficulty getting answers to complex questions.