How to Win Over Private Money Lenders or Partners for Your Deals

by | BiggerPockets.com

For those of you who have not worked with private lenders or equity partners in the past, know that at some point you will need to go this route if you plan to expand your business. If you have worked with these investors in the past, you know realize it’s very important to ask the right questions up front to better understand that investor and how to best structure a win/win situation with them!

Related: How I Find Private Money Lenders to 100% Fund My Deals (& How You Can, Too)

It can be tempting to talk about the great deals you have lined up, your rate of returns, or your company’s track record when you speak with a new investor. Before you get into anything about yourself, you need to take some time to get to know your investor. In this video, I discuss three important questions you have to ask to really get to know your potential private money lender or partner.

Please leave a comment and share a story you have about understanding investors needs.

Thanks for watching!

About Author

Matt Faircloth

Matt Faircloth, Co-founder & President of the DeRosa Group, is a seasoned real estate investor. The DeRosa Group, based in historic Trenton, New Jersey, is a developer and owner of commercial and residential property with a mission to “transform lives through real estate." Matt, along with his wife Liz, started investing in real estate in 2004 with the purchase of a duplex outside of Philadelphia with a $30,000 private loan. They founded DeRosa Group in 2005 and have since grown the company to owning and managing over 370 units of residential and commercial assets throughout the east coast. DeRosa has completed over $30 million in real estate transactions involving private capital including fix and flips, single family home rentals, mixed use buildings, apartment buildings, office buildings, and tax lien investments. Matt Faircloth is the author of Raising Private Capital, has been featured on the BiggerPockets Podcast, and regularly contributes to BiggerPockets’s Facebook Live sessions and educational webinars.

6 Comments

    • Matt Faircloth

      Hey Caroline,

      Thanks for the comment! You don’t get off that easy though, lol! Tell us all more! What is the project, target amount to raise, projected return? What do you plan to offer investors? How are you going to structure your approach to your investors?
      I am hoping we can use your case as a learning for others, if you don’t mind me picking on you a bit, ha ha.

      Thanks!

      Matt

  1. Gloria Dulan-Wilson

    Thanks so much for that insight and information. I am somewhat intimidated by this process – even though I’ve gotten funding for the renovation of properties before, it was through the Non-profit organization I headed in Brooklyn. It’s different when it’s for your own project – and I admit I am nervous because I do have some potentially good deals that I am looking at. I am going to watch your video again – I really appreciate your candor.

    • Matt Faircloth

      Hey Gloria,
      Glad you enjoyed! Although it is different from an emotional and priority perspective, it’s the same when it comes to dollars and cents. Try pitching the deal to a few people as preparation to sit infront of a key lender or partner. That way you can get warmed up and perhaps get some feedback before you go for the real meeting with the lender.
      Good luck!
      Matt

  2. Victor Pierson

    Great tips, Matt. Before watching this, I would have started out trying to sell myself, but looks like that’s the exact opposite tactic I should use! I’m an active investor, but all my work has been 100% self funded, so I’m completely tapped out while doing a project, and can’t move on to another one until it sells. So I’m now looking to expand my business by getting funding a variety of different ways, including private lending. I’m putting together a three page brochure to bring to meetings that outlines a variety of things, including what I’m all about, and some befores/afters. What’s your thoughts on the brochure track? Thanks again!

    Victor Pierson

  3. Roy Johnson

    I am looking in to raising capital to purchase multifamily (apartments) I have the time and knowledge. I am looking for acquisition fee 3 per cent and 25 percent equity..in deal. Standard 3_5 and 25_50 percent. I will give monthly returns.
    Min cash on cash 12 per cent and 1.4 debt service minimums. How would you approach attracting JV partners in this type situation. Get under contract then find investors? I understand deal you will find the $

Leave A Reply

Pair a profile with your post!

Create a Free Account

Or,


Log In Here