Collection

Collection — everything between a missed payment and your money: demand letters per the note’s terms, extrajudicial foreclosure of the REM (Act 3135 — auction, then the borrower’s redemption period, typically one year for individuals, while your capital sits), or replevin/sale under a chattel mortgage, then resale of collateral you priced to be happy owning. PH collection friction is why private rates run 18–36% while US hard money runs 9–13% — the premium is the friction, and a lender who won’t actually use the path has no security, only stationery.

First used in: 4.5 · Private lending: being the bank