Loans

photo credit: Michel Jones

Believe it or not, hard money lenders want the same thing you want – a shot at a great investment. Remember: investing involves putting up your time and/or money with the intention of realizing a profitable return. When you keep this concept in mind, it’s astounding just how broad the investing arena actually is. High rise buildings, apartment complexes, condominiums and luxury office space can become a reality – not just a dream!

If, for example, your credit rating is bruised and you’re pressed for time, securing a hard money loan for a shot at a great commercial property – that’s investing. (more…)

photo credit: TheTruthAbout..

.Say you have a subject to. How can you give a first mortgage to a private lender if you are going to be making the mortgage payments?

First things first! That is kind of a trick question because you can borrow both first and seconds from private lenders. Did you know this?

Now private lenders come in handy when you’re borrowing a second behind the subject-to loan. In fact, it will always be a second if it’s behind a subject-to loan, and that is commonly used when you are borrowing small amounts of money to either bring payments current (or pay the seller some cash to get out – or both – or doing some repairs, etc.). (more…)

photo credit: gcoldironjr2003

Private Lending Topic – I have received a number of email questions recently on very similar issues and thought I would address them as a group versus individual emails. The questions are broken down into general areas and include things to do and things not to do. The Don’ts include advertising on Craig’s List and the use of the word “Guarantee”. The Do’s include what are the best marketing methods. My comments on each are below….

Don’ts

Private Lending Advertising on Craig List – I do not recommend that you advertise on Craig List. It is too public and there are state and federal watchdogs looking for people who may be violating securities rules. I have said on many occasions that I do not recommend any advertising that is on a national scale including your own web site. This kind of advertising will get you into trouble with securities regulators and may be considered a securities offering to the public.

I know this from personal experience. Several years ago a person responded to my Craig’s List ad requesting information about my investment program. After several emails, the individual said he was ready to invest and I directed him to my title company to prepare the appropriate documents. Strangely, I never heard from the individual again after that. (more…)

photo credit: woodleywonderworks

Finding a private money lender is an essential part of any real estate investor’s business. In the old days (pre-2006) you could easily get a mortgage or even hard money loan simply by showing up in the lenders office and filling out an application. If you could walk and talk you qualified for a loan.

But today in the post credit-bubble market those days are over. Getting money for your real estate investing business is much more difficult and likely to get even more difficult as the credit markets sort things out. So how do you get money for your real estate investment business? (more…)

photo credit: ryunosuke00

Getting private money lenders into your real estate investing business is critical to your success as the credit bubble makes getting traditional mortgages very difficult. Mortgage lenders are now requiring 700+ credit scores and documented sources of income. This can very hard for most real estate investors. Hard money lenders are also drying up as the credit bubble continues to take its toll on borrowers. So how do you get money for real estate deals?

The answer is private money lenders. But how do you get private money lenders?

We teach our students how to use simple marketing techniques to attract private lenders. Once you start to attract private lenders you can set up one-on-one meetings or group meetings where you can lay out the advantages and benefits of investing money with you. (more…)

photo credit: David Boyle

In a typical private money lending transaction, you the real estate investor (borrower) will borrow from a private individual (private lender) and the transaction is documented by a Promissory Note and Mortgage.

Additionally, you will need to name your private lender on your property insurance. We also recommend you included a disclosure statement.

Promissory Note

One of the most important documents you will ever sign with a private lender is the actual Promissory Note that creates the loan obligation. (more…)

photo credit: faungg

..One the most frequent questions I get from students or newsletter subscribers relates to how can I raise money to buy real estate investments through private lending without getting in trouble with the SEC. This is not an easy question but certainly an important issue. Before I would answer this question, I always tell people that I am not an attorney and the advice I give is from my personal experiences and education and should not be considered legal advice.

Is borrowing money for real estate investments from a private lender considered to be issuing a “Security” as defined by the federal SEC or possible your state SEC? The federal SEC defines a “security” as a financial instrument such as stocks and bonds including such things as notes or evidences of indebtedness etc…. (more…)

photo credit: Petrick2008

How Do You Market To Private Money Lenders? As I’ve said before, every business on the planet is in the business of MARKETING.

Yes, that includes you.

First and foremost you are a marketer… second you are an investor. You must know how to get leads in order to even have a chance to put your investment knowledge into action.

So, to get private money lenders for your real estate investing business you must find the people who have money. (more…)

photo credit: Derek Farr ( DetroitDerek )

Wow, has the real estate market changed in 2008! Real estate investors have been shut out of traditional mortgage money unless you have a 9000 credit score and a 50 year work history without missing one day of work (ok enough of the weak humor but you get the idea). Even hard money loans are HARD to get as they have all gone out business.

But just as the mortgage market is shunning the real estate investor – we are starting to see signs that the real estate marketing is starting to bottom and home prices have even gone up in some markets. (more…)