I am just starting out in real estate investing and have some very short term goals i would like to accomplish.
1- I would like to complete 1 rehab deal by years end.
2- I would like to lend money to someone and learn the process by being on someone else's deal
I have about 50-75K to invest, I would prefer to lend the money out on a solid deal with a 90 turn around.
Can anybody give me a few tips on what I should be looking for to get in the door? Or perhaps the better question is where should I be going with my money?
I'm starting to put investors together for a buy and hold deal down here in SoCal. It sounds like you want to lend to a flipper and get your money back soon, is that correct?
You shouldn't have any problem finding takers. I would caution you, however, to stick with experienced flippers who know their market well. It's far too easy for a novice to go over-budget, over-schedule, then not be able to sell the property for enough to cover the loan.
Ty - You say there is no risk, then go ahead and say there is 5% risk. Which is it? Thanks.
cant add you. the link to add isnt there.
David -
Go to his profile and the link should be there. If not, please PM me and let me know.
Edited: 06/26/2010 at 12:04PM
Joshua Dorkin, BiggerPockets, Inc. E-Mail: webmaster@biggerpockets.com Telephone: 877-831-4704 Website:http://www.biggerpockets.com Be sure to check out the BiggerPockets Blog at http://www.BiggerPockets.com/renewsblog/
there is risk with every investment....minimize that as best you can...there are several private money brokers on here...i have used joel soforenko and he is good at keeping things running smoothly....you can find joel or others on BP...best of luck
My suggestion is to stay in your own back yard for a couple deals. Find a local Investment firm doing rehabs etc. Also, talk to an attorney about preparing for you a personal lender contract.
My suggestion is go to your local title companies and find experienced wholesaler and rehabbers, talk to them about funding the downpayments only, using LLC and make sure they can complete the deal with qualified buyer, then use OPM. Lawyers might be a better place to start. Make sure you have control or asset to back any investments. The benefit of Hard money, is you can trust that a lender will not do unworthy or risky deals .
I have a great deal in akron ohio. The deal purchase price is $45,000; it is worth $108,000 and need $15,000 in repair. The LTV is well below 50% and my number are base on realtor comps and will be willing to back the deal up with apprasial if it would make the private lender comfortable.
The property sit in a good neighborhood and the rate is open for discussion because I am looking for a relationship and not a one time transaction. I have 7 more deals with this much equity if not more that are coming in the next month or so.
I am looking for a private lender or partner.
The deal is well below 50% Arv, it is in a very good area, and it is being sold by a private owner. My number for the property come from the owner sale price, comps are from my realtor in this area and he is a top producer. The number for the work to be done come from a licensed and bond contractor. I plan to rehab it a sell it to one of the investors on my buyer list. If the property has not sold in three day my exit strategy will be to list it with my realtor at a generous quick sale price and take my profit from there. So you see that I have everything I need to make this deal work except the money. I need some someone to put the money up for the deal. That is the purchase and rehab cost and in the rehab cost I have factor in 4 payments for the loan just in case I can't find a partner.
If you have anymore questions feel free to contact me.
What you want to do is private lending. I can help you with that since this is what I do on a full time basis. I lend money particularly to flippers. I can show you the people you need to talk to and what to watch out for to cover all your downsides. I have a contingency plan for each risk. If you want to know more, then shoot me a PM.
further to my previous post - make sure if you invest that the person bringing the deal to you invests with you. sit at the closing table with your own attorney and make sure your investment is pari pasu with theirs or better yet - if they are so confident about the deal put your money in front of theirs.
I do appreciate your question, the risk is not to your original investment, your 5% exposure risk is based and will effect your return on the investment only.
i purchase properties and hold them in central indiana. i will send you an article i wrote that is under review by bp. the jist of the article is the is how now is the time to purchase homes to lease and wait for market to rebound thus locking in the low purchase prices that exist. you then good returns via rent then an eventual sale down the road. less risky than a flip in this troubled market. finally, if you do invest with someone - get their accountant involved. accountants dont want to risk their reputation or designation. beware of those who use religion as a trust mechanism.
What does that mean? I have absolutely no idea what you're talking about. Please clarify.
Edited: 06/26/2010 at 12:26PM
Joshua Dorkin, BiggerPockets, Inc. E-Mail: webmaster@biggerpockets.com Telephone: 877-831-4704 Website:http://www.biggerpockets.com Be sure to check out the BiggerPockets Blog at http://www.BiggerPockets.com/renewsblog/
David, if you're still contemplating learning how to successfully make hard money or private mortgage loans you may want to visit my website, articles about the basics of hard money lending are there. If you want further info, contact me and I'll send you a free copy of my ebook "Investing in High Yield Trust Deeds After the Real Estate Meltdown". The amount you wish to invest is below our minimum investment but I am still happy to provide you with information culled from my experience having made over $62 million in hard money loans (mostly commercial) in the last 8 years.
