--- title: Reducing Concerns Regarding Loan Extensions description: Some investors hear that the borrower received an extension and often think that this is a bad thing. Learn how extensions can benefit investors. image: https://learn.upright.us/hubfs/extension.png --- [![Upright Real Estate Investment](https://learn.upright.us/hs-fs/hubfs/Upright_RGB_PrimaryLogo-2.png?width=175&height=42&name=Upright_RGB_PrimaryLogo-2.png "Upright Real Estate Investment")](https://upright.us/) [![Return Home >](https://no-cache.hubspot.com/cta/default/2129804/90add894-e0b2-4f0c-bc22-7c5b348dd1d7.png)](https://cta-redirect.hubspot.com/cta/redirect/2129804/90add894-e0b2-4f0c-bc22-7c5b348dd1d7) [Back to the Blog](https://learn.upright.us/real-estate-investing-blog) # Reducing Concerns Regarding Loan Extensions April 15, 2020 | By [Joseph Zidek, Servicing Agent](https://learn.upright.us/real-estate-investing-blog/author/joseph-zidek) One of the more common questions asked by real estate investors is, “When will I receive my principal back?” The principal repayment is dependent on the borrower, who must repay the underlying loan before the investor will receive the principal that they originally invested. When some investors hear that a borrower has been granted a [loan extension](https://learn.upright.us/real-estate-investing-blog/loan-extensions-risk-management-tool), they often think that this is a bad thing. While this may delay the time it takes to be repaid, an extension can actually be a rewarding outcome to lenders. Real estate has many moving parts and there can often be many variables that arise over the course of a project that may impact the time in which it is completed. Extensions not only grant the borrower more time to complete their rehab, but they provide a greater return to the investor. A borrower must pay an extension fee as part of the extension approval process. This fee is shared between Fund That Flip and investors, providing additional return on the investors’ capital. During this extension, investors continue to receive monthly interest payments as well. Fund That Flip's number one priority in these deals is the preservation of capital, which gets returned to investors. To help ensure this, we have both a borrower success and an asset management team. Our borrower success team communicates constantly with the borrower to understand their needs and progress to determine if an extension is the best path forward to achieve a successful exit. On deals that extensions are granted, we are often asked why we have not initiated foreclosure. During the extension process, our asset management team evaluates all viable options which could include foreclosure. Foreclosures are time consuming and costly, whereas extensions provide time for the borrower to complete the rehab and successfully exit the loan. This gives the investor a timely and more whole principal payment on top of the extension fee and additional months’ interest. As an investor in a deal, the initial thought of the borrower receiving an extension on their loan may seem scary. The idea of prolonging the time between lending your money and receiving this principal back can definitely be frustrating, but maintaining a long-term mentality on your investments will allow you to see the bigger picture where you are able to earn higher returns than you could have otherwise. ![Some investors hear that a borrower has been granted an extension, they often think that this is a bad thing. Learn why extensions are good for investors.](https://learn.upright.us/hs-fs/hubfs/extension.png?width=600&name=extension.png)   Looking for an alternative to stocks? Investors can earn up to 12% annual returns on pre-vetted, low LTV, real estate-secured loans. Fund That Flip offers industry-leading visibility into each project, enabling investors to be highly selective in the loans they choose to fund. Click below to make an investment today! 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