Instalend 2024 Review and Ranking

What is Instalend?

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To avoid the financial conflicts-of-interests that are rampant on virtually every other review site, I DON'T accept any money from any outside sponsor or platform for ANYTHING (including but not limited to affiliate ads, advertising etc.). See code of ethics  for more.
 

UPDATE Dec 2018: Sohin Shah, one of the principals of Instalend was named as a codefendant in a lawsuit by the SEC (US Securities and Exchange Commission). The SEC charged him, along with the CEO of iFunding (William Skelly) of misappropriating more than $1 million of investor money, misrepresenting the number of real estate projects that the company had financed, misrepresenting the amount of funds they had raised, and making fraudulent claims about the use of the money. (More here).

As such, Instalend is being downgraded to "challenged" and the minimum of 1 (out of 10) stars. It has also been stripped of its ranking until this issue is resolved.

Original Review:

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Instalend specializes in residential debt (sometimes called hard money loans).

They are a newcomer to the rankings and had just enough volume to qualify (3 open investments). Unlike many sites and in a positive looking sign for conservative investors, all 3 loans were below 65% LTV. Lower LTV loans are essential for ensuring enough of an equity cushion to withstand all the costs of foreclosure and a downturn. (See "Hard money loan Roulette:Part 1").

Instalend is one of the few sites that doesn't charge any platform fees. And on top of that, it's the only site currently in business that doesn't charge investors any deal level, property, management  or other fees on top of that. For investors, the service is free (instead, sponsors pay 3 to 3.5% to list on the platform).

Unusually, they don't pre-fund the notes. If the investment isn't popular enough, this can mean that investor may not be able to close on a note that they select. Management claims that this is not an issue and that all of the notes on the platform have closed successfully and done so quickly (within a couple of days).

Instalend has a few fairly serious shortcomings. They lend primarily in states without a nonjudicial option. This means but if something goes wrong with the investment in the platform have to foreclose, it won't be a quick process taking just a few months and costing a few thousand dollars. Instead, it will be inexpensive court process, that can typically take a year or more and be very expensive. Conservative investors  steer clear for this reason alone.

Second, all investors may be concerned that the site does not offer bankruptcy protection. If they go out of business, investors could be left high and dry.

We hope they consider addressing these issues by the time of the next review so they can be ranked higher.

 

• Advantages: truly no fee for investors (including both platform level and unusually:deal level).
   

• Disadvantages: Low volume. No bankruptcy protection. Lending in states without a nonjudicial option.
   

• Accolades: None

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For more raw data on the site (including investor and sponsor fees, legal structure etc.), or to easily compare it with the data of competitors, see the feature by feature comparison matrix.

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Where can I discuss other Instalend deals?

You can do this with thousands of other investors in the private investor club. While the club is free, membership is restricted to investors who have no business connections to sponsors or platforms. Also, all members must agree to keep all club info confidential by signing a nondisclosure agreement. Click here to join or get more info.

Who are Instalend Competitors?

 

Here are the reviews and rankings for other residential debt sites:
 

• Peer Street

• Fund That Flip

• ShareStates

• Zeus Crowdfunding

• AlphaFlow

• LendingHome

• InstaLend

• YieldStreet

• Patch of Land

• GroundFloor
   

• All other sites (ranked)
   

• To compare this site directly with competitors, see the 
  feature by feature comparison matrix.

OR...if you're looking for more volume and/or more conservative LTV's than most crowdfunding sites provide, then a fund might be a better choice for you. If so, here is our Guide to the Top 15 Hard Money Loan Funds (and honors). 
 

Debt Investing Tutorials:

 

Looking to learn more about debt (hard money loan) investing? Here's our 4-part step-by-step series.

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• Hard Money Loan Roulette. Part 1: What's a hard money loan and what are the hidden costs

• Hard Money Loan Roulette. Part 2: How to protect your money

• Hard Money Loan Roulette. Part 3: A due diligence checklist

• *Hard Money Loan Roulette. Part 4: Top 15 Hard Money Loan Funds for 2018 (And Honors)

Related:
 

How to pick? Check out our step-by-step guide.
 

• The quick guide to picking conservative real-estate deals
   

• Top 100+ accredited investor sites (ranked and reviewed)