{"id":33168,"date":"2020-02-28T10:30:21","date_gmt":"2020-02-28T15:30:21","guid":{"rendered":"https:\/\/www.escapeartist.com\/?p=33168"},"modified":"2020-07-22T01:25:03","modified_gmt":"2020-07-22T05:25:03","slug":"investment-options-in-colombia-factoring-debt-judgments","status":"publish","type":"post","link":"https:\/\/www.escapeartist.com\/blog\/investment-options-in-colombiafactoring-debt-judgments\/","title":{"rendered":"Investment Options in Colombia\u2014Factoring Debt Judgments"},"content":{"rendered":"

Investment Options in Colombia\u2014Factoring Debt Judgments<\/strong><\/h2>\n

The Colombian economy has shown immense improvement over the past three years\u2014 it has grown at <\/span>an average of 2.7%<\/span><\/a> since 2017. These growth rates are higher than those for Brazil, Argentina, and many other big-players in the Latin American continent.\u00a0<\/span><\/p>\n

With the government focusing on reducing government debts, introducing fiscal austerity measures, and improving GDP rating\u2014things are finally looking up for the country. Indicators like Moody\u2019s sovereign rankings have <\/span>also shown an improvement<\/span><\/a>, with the representatives from the agency showing confidence in the country\u2019s debt management strategies.\u00a0<\/span><\/p>\n

This spells good things for investors who are looking to diversify their portfolio and benefit from the many government-facilitated investment opportunities in Colombia. At this moment, you can invest in taxi loans, government debt judgments and mortgage loans. According to my sources, these are prime investment options with many players in the market facilitating foreign investment inflows to generate major returns. One of the safest bets you can make is investing in the Colombian government\u2019s debt judgments.<\/span><\/p>\n

This article will basically describe what debt judgments are, why you should invest in them in Colombian.<\/span><\/p>\n

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What is Debt Factoring?<\/b><\/h2>\n

Debt judgment investments have been around for a very long time and are generally considered risky investments. Before we can talk about investing in judgments, we should understand what debt judgments are. Imagine that person A takes a loan from B that they never return\u2014B can sue A for not paying them back and the courts will <\/span>pass a judgment<\/span><\/a> recognizing that the debt has to be repaid. The court itself won\u2019t do anything for recovery\u2014the judgment is legal recognition of an obligation on the part of A.\u00a0<\/span><\/p>\n

In certain situations, the court passes ownership of some of A\u2019s assets to B\u2014without granting B the right to sell them off.\u00a0 Now sometimes, Mr. A still won\u2019t pay the money back, and Mr. B finds themselves really strapped for cash\u2014so what do they do? Person B can approach a third-party who will buy off the debt judgment for the original amount loaned and transfer ownership of the judgment to themselves.\u00a0<\/span><\/p>\n

This third-party can now call in the debt to receive the full amount of money loaned out and any interest accrued during the non-payment. This way, person B gets their money back and the third party makes a profit from their investment.\u00a0<\/span><\/p>\n

There\u2019s still a risk associated with this investment because what if the original creditor goes bankrupt and can\u2019t pay the money back? There\u2019s little to be done in that situation where the money is unrecoverable\u2014but what if you\u2019re buying off judgments passed against a government?<\/span><\/p>\n

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Investing in Debt Judgments against the Colombian Government<\/b><\/h2>\n

\u00a0While it\u2019s very likely that people might go bankrupt, there\u2019s no way that a government can go bankrupt. Even if it does, it\u2019ll very likely get bailout packages or some other financial assistance that ensures it stays in business. For this reason, investing in government debt judgments is possibly the safest investment anyone can make.\u00a0<\/span><\/p>\n

Investments in judgments<\/span><\/a> against the Colombian government debt have become a popular investment instrument for foreigners. Middlemen approach people who are owed money by the government to buy off the debt at discounted rates\u2014using the money they get from foreign investors to make profits off the debt when the government pays it back. The middlemen also distribute the profits among their investors based on the size of initial investments.<\/span><\/p>\n

Now that the Colombian government has managed to clamp down on domestic debt, people are slowly moving their capital into the country\u2019s debt markets. This is where we get the investment plan.<\/span><\/p>\n

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Investing in Debt Judgments in Colombia<\/b><\/h2>\n

The Gutierrez Group i<\/span><\/a>s a wealth management firm that is creating investment funds working with public debt judgments in Colombia.\u00a0 The company is buying up relatively safer debts in institutions like law enforcement agencies, the ministry of defense and other branches of the Colombian government. They\u2019re taking advantage of the fact that any claims taken to court take about five to eight years to process\u2014a time span that the average Colombian investor can\u2019t afford to wait. The payment for these debts also takes about two to four years, which only adds to the time they have to wait around.\u00a0<\/span><\/p>\n

The Gutierrez Group buys this debt to transfer it to their name instead, to collect on the indemnities. They collect funds from interested investors to finance the debt transfers and offer great returns on these investments. Unlike other investment companies that work through middlemen to get the job done, the people at Gutierrez Group handle all of the transactions and transfers themselves.\u00a0<\/span><\/p>\n

The process of buying debt involves the following five steps:<\/span><\/p>\n

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  1. Once a judgment is passed, the team at Gutierrez Group negotiates debt purchase.<\/span><\/li>\n
  2. They set a price and finalize the paperwork to transfer ownership.<\/span><\/li>\n
  3. It takes 6\u20138 weeks to transfer ownership.<\/span><\/li>\n
  4. Once the notice is received, payments are executed to finalize the transaction.<\/span><\/li>\n
  5. The government pays the debt back within two to four years and the returns are paid back to the investors.<\/span><\/li>\n<\/ol>\n

    The returns offered by the Gutierrez Group<\/a> are:\u00a0<\/span><\/p>\n