My duplex throws off cash every month and I am sitting here wondering if I should be lending it out instead
Not a lender, not even close, but the duplex my aunt left me cleared about $2,100 last month after taxes and insurance, and I have been letting it pile up in a HYSA at 4.3 percent because I cannot decide what to do with the property itself. Someone in a different thread mentioned putting idle cash into a first-position note at 10 or 11 percent and I got stuck on that. I do not need the duplex money for anything specific. The tenants have been there four years, pay on the first, and I have never met them. So the cash sits. The thing I cannot figure out is whether lending out, say, $40k at 10 or 11 percent first position on someone's flip is actually safer than what I am doing now or whether I am just attracted to the number. The HYSA is boring but I understand exactly what can go wrong with it, which is basically nothing. A note secured by a property two states away is a different category of thing and I have not worked through what I would actually do if the borrower stopped paying at month four. Does the cushion in the collateral do what people say it does, or does that depend entirely on being able to move fast in a foreclosure state and knowing who to call when you get there.
