024: How to Prepare for Rising Interest Rates

We specialize in providing flexible short-term hard money and transactional loans for real estate projects. We also invest in equity of strong real estate projects with proper leverage and strong sponsors.

024: How to Prepare for Rising Interest Rates

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Today’s episode is a presentation I have put together about how to prepare for raising interest rates and other topics. I answer many questions about interest rates and how a fund can better prepare you for an economic downturn. Some of the questions I answer are,

  • What to do when interest rates go up.
  • What does the Federal Reserve do?
  • How can you protect your investments during an economic change?

MINUTE MARKERS

00:00 — Introduction to the Big Mike Fund Podcast.

00:22 — Welcome to my presentation.

01:02 — About me and professional background.

01:36 — What Tempo Fund specializes in and other resources we offer.

02:07 — The current state of interest rates.

03:30 — What is a cap rate? How is it used?

07:17 — What happens to cap rates when interest rates go up?

08:01 — Why cap rates get worse.

09:30 — How interest rates affect prices.

10:39 — 3 examples of how interest rates work.

12:00 — DSCR requirements and what that means to a bank.

15:52 — What do these examples teach us?

16:18 — How interest rates affect the value of a project.

21:17 — Is it possible for the asset prices not to fall even with the rising interest rate?

22:11 — Why the Federal Reserve raises interest rates.

24:37 — Maybe, interest rate increases are good for real estate?

28:17 — How the Federal Reserve raises interest rates.

29:00 — The Federal Reserve is raising interest rates too fast.

29:54 — The problem with short-term interest rates.

30:05 — A brief recap of the economic state of the market.

32:23 — How can you prepare for an interest rate rise?

35:43 — How to invest with an economic downturn in mind.

36:30 — Why should you invest in value-add projects?

38:14 — Individual deals vs. Funds

40:37 — The Tempo Opportunity Fund.

42:40 — My contact information.

43:50 — Thank you for listening today.

43:53 — Outro to the Big Mike Fund Podcast.

RESOURCES

Big Mike Fund

Tempo Funding

Tempo Funding Platform

Real Estate Investment Fund: How to Choose a SMART Real Estate Investing Fund: Top 10 Biggest Mistakes To Avoid Before Investing Into a Real Estate Fund (Private Money, REITS, Equity, Structure, Tax)