What I Actually Look At Before I Lend a Dollar

Most investments look great on paper when everything goes according to plan. That's not what tells me anything useful. What tells me something useful is what happens when the plan doesn't go perfectly — because eventually, on some deal, it won't.

I think about this constantly with private lending, because it's the part of my business where I'm putting real capital behind a borrower's promise. So before I ever lend a dollar — mine or yours — here's what I'm actually looking at.

It starts with the borrower

Underwriting doesn't start with the property. It starts with the person or team asking for the money. Do they have relevant experience? What's their financial position? What's the actual purpose of the loan, and how realistic is their plan? If the renovation runs long or costs more than expected, do they have the capacity to handle that, or does the whole thing fall apart at the first surprise?

I've seen plenty of solid properties attached to shaky borrowers. That combination doesn't make a solid loan.

Then it's the collateral

Once I trust the borrower, I look hard at what's actually backing the loan. What's the property worth today — not in some optimistic future scenario? What assumptions support its projected value after renovation? How much am I lending against that value? Is there enough equity underneath my position that if things go sideways, there's still a margin of safety?

Loan position matters here too. Being in first position means I generally stand ahead of other creditors on that property. That's meaningful in a default. It's not a guarantee — foreclosure, market declines, legal costs, and delays can still cost money — but it's a real structural advantage over being subordinate to someone else's claim.

Diversification only works if the loans underneath it are good

A fund holding many loans can absorb one borrower's failure a lot better than a single direct loan can. But I want to be honest about something: a portfolio of forty weak loans isn't conservative just because there are forty of them. Diversification is a risk-management tool, not a substitute for underwriting discipline. It only does its job when what's underneath it was vetted properly in the first place.

Duration matters more than people give it credit for

I pay close attention to how long my capital is actually committed. A long-term investment locks in assumptions that have to hold up for years — interest rates, property values, economic conditions, all of it. The longer that stretch, the more chances something shifts underneath you.

Short-term lending works differently. Capital goes into loans built to mature within a relatively short window, after which it can be redeployed under whatever conditions exist at that moment. That flexibility matters a lot in an uncertain environment — I'm not locking in today's assumptions for the next decade. It doesn't remove credit risk, but it gives me far more chances to reassess and adjust as things change.

Illiquidity isn't automatically bad — but it has to be honest

Private investments often limit withdrawals for years, and I'd never tell someone to commit money they might need unexpectedly. But I don't think liquidity should just be maximized for its own sake either. Full daily liquidity sounds nice, but it also invites daily price-watching and emotional decisions. Accepting a defined period of reduced liquidity can actually let a manager invest properly, without being forced to sell into a bad market just because someone wants their money back that week.

The real question isn't "is this liquid?" It's "do the liquidity terms match what the assets actually are, and what I actually need?" 

The manager matters as much as the deal

In public markets, I get standardized disclosures and market pricing whether I like it or not. In private markets, the manager has a lot more discretion — over underwriting, valuation, servicing, and what happens when a loan goes sideways. That's exactly why I look as hard at the people running a strategy as I do at any individual deal.

I want to understand their track record, their underwriting process, how they're compensated, and — maybe most importantly — how they talk about what can go wrong. A manager who's only willing to talk about the upside isn't giving me the full picture. Being upfront about risk isn't a weakness in an offering. It's usually the clearest sign I'm getting the information I actually need.

How this shows up in the Blue Vikings Income Fund

This is the exact framework behind how I built the Blue Vikings Income Fund — short-term, real estate-backed loans to experienced investors acquiring and renovating property, spread across a diversified portfolio rather than resting on any single borrower. Every loan goes through borrower vetting, property valuation analysis, and gets secured with a first-position lien.

As of August 2026, the Fund is open to accredited investors with a $25,000 minimum, with preferred annual return tiers from 7% to 10% depending on investment amount, paid out monthly — either as distributions or reinvested for compounding. There's an initial six-month period before liquidity opens up, governed by the Fund's documents.

None of this makes the Fund risk-free, and I won't pretend otherwise. Borrower default, property-market shifts, and execution risk are all real. What I can tell you is that every loan goes through the process I just walked you through — the same questions I'd ask if it were only my own money on the line, because it is (I’m the largest investor in the Fund)..

If you want to see exactly how a loan gets underwritten before it goes into the Fund, I'm glad to walk you through one. Reach out anytime, or visit bluevikingscapital.com.

This article is for educational and informational purposes only and does not constitute an offer to sell, a solicitation to buy, or individualized investment, tax, or legal advice. Alternative and private investments involve risk, including possible loss of principal and limitations on liquidity. Prospective investors should review the applicable offering documents and consult their own financial, tax, and legal advisers before making an investment decision.