BiggerPockets

Hard Money Ain't So Hard!

Thursday, January 07

Last night I was browsing my local county website.  During the last few weeks, I had noticed someone's name, that I won't mention, always pop up on comps that I was pulling.  To be honest, I wanted to contact this person to ask them out for lunch or a beer to pick their brain.

I went on the county website and typed in their name and searched from Trustee's Deed.  Low and behold they are a buying machine and recently started buying in 2009 at auction.  By machine, this person is buying 5-10 properties per month.  Someone buying that many has to be moving them pretty quickly.  

So that got me thinking, and I entered their name into the deed of trust document search to see if they are buying with cash or hard money or private money. Low and behold, they are using numerous lenders.  Some here in town, some in Utah, some in Oregon, they are all over the country.  Then something catches my eye, all the deed of trusts have the same "When recorded, mail to:  blah blah".  They all had the same PO Box, everyone of them!

So, I type the PO box number and address into Google and a I FINALLY find the who it is and I get their phone number.

I call them today on my lunch break and this is how the conversation goes:

Him:  Hello, this Steve

Me:  Hi, My name is Justin and I'm a real estate investor in Arizona.  I found your name on our county recorder site.  Are you actively lending money?

Him:  Yes we are.  Do you have a property now or you are trying to line up financing?

Me:  I'm trying to line it up.  I buy at auctions and REO's.  Do I need to qualify with you or is it based on the property?

Him:  It is solely based on the property.

Me:  What are your terms?

Him:  The terms are pretty simple.  18% interest only, no prepayment penalty, no upfront payment, no points.  Just monthly interest payments.   We do charge a $900 processing fee per property though.  Loan is based on the lowest comps in the neighborhood.

Me:  This may sound like a stupid question, but do you run out of money?  Do I need to be worried when I put in auction bids.

Him:  Sometimes, if you are buying at auction, just give us a call in the morning to make sure we can fund you.  

Me:  What do you require me to put into the deal?

Him:  20-30%.  On average its between 25-30% right now.  

Me:  Great, so I just call when I need you and thats it?

Him:  Thats it.  

Me:  Great, you'll hear from me soon.

Him:  Great, goodbye.  Me:  Goodbye.

There you have it.  One of the simplest ways to find funding.   Now go do it.

Search for Trustee's Deed.  Find out who is actively buying.

Take their name and search for deed of trusts.

Record the mailing address of the lender and enter into Google.

Odds are they have a website and you can find their number.

Comments

1. 

   Will Barnard Reply
   over 2 years ago

   Great Job Justin. Goes to show that a little hard work and good old know-how goes a long way.

2. 

   Nick J. Reply
   over 2 years ago

   Thats awesome! Great story and great to see you've come so far since a year ago.

3. 

   Justin S. Reply
   over 2 years ago

   Thanks guys. Its a amazing to me how much info is out there, you just need to know where to look.

4. 

   Ted Harris Reply
   over 2 years ago

   great read Justin and remarkably simple!

5. 

   James Ward Reply
   over 2 years ago

   Really cool, Justin!

   I have read lots of books and articles about doing exactly what you did. But, you are the first person that I know and they can confirm the success.

   One last questions: Are you planning on calling more?

   Thanks,

6. 

   Justin S. Reply
   over 2 years ago

   Hey James-

   Yeah, I'll probably do some digging this weekend and calla them next week. I want to find a private lender. I plan to use the same strategy to find more cash buyers as well. Some of the shorts I have in work have great spreads. I'm using them to build my buyers list this year. Marcopa.gov has an extremely userfriendly website for this kind of research.

7. 

   Justin S. Reply
   over 2 years ago

   Hey Ted -

   It is simple. We are talking maybe 5 minutes worth of research. After about the third deed of trust I looked it at, I released the payments were are all going to the address. It took me more time to find the hard money lender's phone number than anything.

8. 

   Stephen Moore Reply
   over 2 years ago

   nice job justin i remember we were just talking about that a few days ago getting hard money...good idea as well

9. 

   Joshua Dorkin Reply
   over 2 years ago

   Great post, Justin . . . I've added it as part of this week's newsletter.

10. 

    Justin S. Reply
    over 2 years ago

    Wow! Thanks Josh, I appreciate that.

11. 

    Nick J. Reply
    over 2 years ago

    luckeeeeeeee

    Great job!

12. 

    Peter Giardini Reply
    over 2 years ago

    Justin... once again you have proved that more then anything else applying just a little time and effort will make all of the difference to a persons success.

    Great job!

13. 

    Charles Perkins Reply
    about 2 years ago

    Great example Justin. Amazing what can be dug up when we know where to dig and actually do the digging.

14. 

    Scott Ouk Reply
    almost 2 years ago

    Way to go Justin. I will try this method myself. Thanks for the great tip.

15. 

    Ted Akers Reply
    almost 2 years ago

    Great job Justin. Like James I was aware of how to do it but have not actually worked it. Congratulations.

16. 

    Ty Kirkpatrick Reply
    over 1 year ago

    Wonderful example of time well rewarded and I appreciate the time you have taken to share this.

17. 

    Bryan Hancock Reply
    over 1 year ago

    Nice article!

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