THE SCENARIO
I live in a condo complex, and this year the Board approved a fairly large Special Assessment to replenish the reserves after the building suffered a variety of expensive emergencies in the past year. Many of the people in my complex, however, are retirees on fixed incomes, and coming up with a bunch of money in a hurry is sometimes hard for people in that situation.
However, since I'm not yet retired, and my income is somewhat higher than the average Social Security recipient's, it might be possible to help out a neighbor or two, and give them a short-term loan. One way to do this is to lend the needed up-front money, and then take 10% of that amount each month for the next year.
If I lend $2,500 today and receive $250 per month for the next year, what's my return on investment?
THE SOLUTION... Read more...
