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An investor’s alternative

With investment yields at all-time lows, investors are in search of products that provide consistent monthly income. However, as property prices come off historic highs and with inflation looming, investors are questioning what is the best way to achieve this without exposing themselves to too much risk.

Established in 2012, AltX’s private real estate debt provides investors with access to first mortgage-backed investment opportunities. With over 1000 transactions completed, this business has clearly connected with an audience who get to “be the bank”, providing funding to borrowers. Alex Goodman, investor relationship director Victoria at AltX, tells us more.

How was AltX established?

AltX got started at the back end of the GFC (global financial crisis) of 2008, when banks had become extremely cautious in their lending practices.

We saw an opportunity to provide loans to borrowers whose credit was good, who had excellent security and sound repayment strategies, but where the banks were not stepping forward to lend. We began lending our own funds and then, as demand took off, we pivoted the business to bring in private investors alongside us.

What is AltX’s product?

AltX provides funding to borrowers secured by registered first mortgages over property. Funding these loans with our own capital, we make these deals available for investors to participate in.

Each loan is unique with respect to borrower, security and loan term, and investors can choose which loan they want to invest in.

AltX manages all the interactions with the borrower, collecting the monthly interest and paying it through to the investor. This makes the transaction relatively hassle-free for the investor.

What do investors like about the AltX model?

The AltX model offers investors three important things which, when packaged together, form a very compelling investment.

Firstly, investors receive monthly income (paid by the borrower). Secondly, their loan is secured by a registered first mortgage over a property to a maximum LVR (loan to value ratio) of 70 per cent. And thirdly, investors benefit from guarantees in their favour from the borrower (in the same way the bank does).

AltX also provides transparency to investors – they get to choose which deal they want to invest in, and what the property security is, and so they know exactly where their money is being invested.

AltX also make valuation reports available should an investor want to learn more about the property that is used as security for their loan.

How does the AltX technology platform work?

The AltX Platform enables investors to access all information relating to a deal in a secure online environment. Investors can review a deal, make an investment, access all information relating to their portfolio as well as investment statements all within the secure online environment of the AltX Platform. This makes investing in our deals accessible from anywhere in Australia at any time. Investors love that they can “self-serve”, based on their own investment criteria, creating their own investment portfolios.

Who can invest in AltX deals?

Currently, AltX is only accepting investment from wholesale investors.

Alex Goodman is the investment relationship director (Victoria) at AltX, and has worked with international technology companies in bringing their products to the Australian Enterprise Business and Government Marketplaces. Apart from his career, Alex is chair of an Australian Friends of Israel organisation, and is involved in voluntary activities including board and leadership roles in national philanthropic organisations.

For more information on AltX, visit altx.com.au

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The information provided in this article is for general information only and does not take into account any person’s particular financial situation, investment objectives and needs. Consider seeking advice from a qualified adviser before making any investment decisions.

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