Real estate crowdfunding is an exciting way to diversify your investment portfolio. For a savvy investor, it can prove to be a smart investment strategy because it often yields high returns. However, it also carries a slightly higher risk than more traditional types of investments. This can come in the form of delayed investment repayments. So, how do investment repayments work and what happens if an investment repayment is delayed?
How do investment repayments work?
When you invest in a real estate crowdfunding project on BrikkApp, you are participating in returns from a loan provided to cover part of the project owner’s expenses. In such cases, repayment of your investments works similarly to other loan repayments: This often comes in the form of a fixed-rate interest or profit-sharing debt and equity investments, which are paid out on a regular basis according to the terms of the contract. Monthly payments may include the principal as well as interest, though in most cases your principal repayment will not typically be paid out until the project has been completed. Similarly, repayment schedules may vary depending on the investor’s specific agreement.
Why might your investment repayment be delayed?
The main reason for a possible delayed repayment of your investment is that the project has fallen behind schedule. This typically happens when unforeseen circumstances cause delays along the way. Deadlines are missed and, as a result, investor payments cannot be fulfilled according to plan. Similarly, economic recessions or highly volatile market conditions can cause unexpected delays.
What does BrikkApp do when the repayment has been delayed?
First of all, we try to prevent such scenarios from happening. BrikkApp assesses the risk profile of any particular investment project before we list it on our platform. Our risk model analyses over 10 different metrics, such as capital distribution, LTV, developer history, investment provider history, location, and security level. For this reason, we believe in the projects that we list to the extent that we ourselves as BrikkApp’s founders invest in these projects as private investors. This means that the same rules apply to us and we are bound by the same terms and conditions.
Nonetheless, unexpected circumstances do happen from time to time. Consequently, at some point, you may find yourself facing a delayed repayment of your investment. This can be a very frustrating experience. If this does happen, it is good to navigate to the project detail page in your BrikkApp dashboard, and then to scroll down to the News section.
When you open up the News section of your selected project, you will see new updates as they come. This is because we are communicating daily with our partner platforms to get frequent updates on your projects.
What to expect in case of a delayed repayment?
What we cannot do when a project gets delayed is to issue the repayment into your wallet. We act as a facilitator between you and the originator platform. This means that in order to issue a repayment, we have to receive the money from the originator platform first.
That being said, we want you to know that we are doing our best to get the funds repaid as soon as possible. This is because we want to be seen as trustworthy partners and because we ourselves also invest in the projects we list on our platform.
It is important to know that if a project is overdue, your interest is accruing until the project’s completion. As soon as we have received the funds from the originator platform, we will issue the repayment into your account. Your interest will be paid out at the same time.
What if you still have questions or concerns?
If, after reading through this article checking the project’s News section, you still have questions or concerns that you’d like to express, we invite you to reach out to us so that we can assist you in your situation.