Pat Foran looks into how people profit from private lending and the risks involved when they lend to individuals who likely couldn’t get loans from banks.
An Ontario woman aimed to earn some extra cash through private lending, so she took out a line of credit on her home.
Initially, everything went smoothly as she received interest payments every month. But now those payments have stopped, leaving her anxious that her $150,000 could be lost.
“I thought it was a relief. This is financial freedom, I thought,” said Deanna Johnson of Whitby, Ont.
Deanna Johnson Deanna Johnson chats with Consumer Alert reporter Pat Foran.
Johnson is a single mom with three boys. She has a full-time job and also works part-time to make ends meet. That’s why she was intrigued when she discovered the possibility of earning income by providing loans.
“I learned about private lending through social media. I watched some Instagram reels about how to create a second income for yourself,” Johnson mentioned.
After visiting her bank and getting a line of credit, she found a company where she could loan out the funds.
Johnson says the first year was fantastic, bringing in interest payments of $3,000 each month.
“It felt like financial relief; it gave me some breathing room. My kids were able to join more sports activities, so it really helped me out,” said Johnson.
However, she shared with that last year things started going downhill; payments began arriving late and eventually stopped altogether. In June, she asked for her money back.
Johnson stated that for the past seven months she’s been trying to retrieve her funds without any luck.
“I would like my money back. My $150,000,” Johnson expressed.
Johnson lent the funds to Dineene Griffith at Unifocus Investments.
Dineen Griffith Dineen Griffith works at Unifocus Investments.
When reached out to Griffith, she responded in a statement saying, “We take this matter extremely seriously and understand the concern it has caused. We are currently conducting a full internal review and are actively pursuing resolution with the third-party company involved.”
“Because this involves confidential client information and an ongoing investigation, we are unable to comment on specific account details at this time. Our priority is protecting our clients and ensuring all appropriate steps are taken.”
Mark Ting, a financial expert from Foundation Wealth, informed that those seeking private loans often face rejection from banks and other traditional lenders.
Mark Ting Mark Ting is associated with Foundation Wealth as a financial expert.
“Just like anything else, higher interest rates come with bigger risks,” noted Ting.
According to Ting, investing in private loans carries risks and anyone thinking about lending their money should proceed with extreme caution.
“Personally I wouldn’t feel comfortable doing it myself or advising anyone else unless they’re very wealthy and can afford to lose that $150,000,” he remarked.</P
As for Johnson’s situation? She told she’s feeling stressed and frustrated while fearing that her loaned $150,000 might be lost forever.
</P “I have two jobs now. I’m back to square one; it’s really upsetting for my whole family,” said Johnson.
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Dineen Griffith Dineen Griffith works at Unifocus Investments.
When reached out to Griffith, she responded in a statement saying, “We take this matter extremely seriously and understand the concern it has caused. We are currently conducting a full internal review and are actively pursuing resolution with the third-party company involved.”
“Because this involves confidential client information and an ongoing investigation, we are unable to comment on specific account details at this time. Our priority is protecting our clients and ensuring all appropriate steps are taken.”
Mark Ting, a financial expert from Foundation Wealth, informed that those seeking private loans often face rejection from banks and other traditional lenders.
Mark Ting Mark Ting is associated with Foundation Wealth as a financial expert.
“Just like anything else, higher interest rates come with bigger risks,” noted Ting.
According to Ting, investing in private loans carries risks and anyone thinking about lending their money should proceed with extreme caution.
“Personally I wouldn’t feel comfortable doing it myself or advising anyone else unless they’re very wealthy and can afford to lose that $150,000,” he remarked.</P
As for Johnson’s situation? She told she’s feeling stressed and frustrated while fearing that her loaned $150,000 might be lost forever.</P “I have two jobs now. I’m back to square one; it’s really upsetting for my whole family,” said Johnson.
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