Good day BP community! As I'm starting to get my contact info out in the world, getting myself on wholesaler lists etc, it's not surprising to get some tangentially related solicitation emails. Many of these claim to be private money lenders (usually offering around 6%). Statistically speaking, some are likely to be low quality services, some are likely to be unscrupulous types trying to steal my identity, but I'm hopeful at least a couple are legit people just trying to make money like you and me. And since I don't have any existing relationships, I have to start fresh with someone. How do you go about vetting these solicitors without exposing yourself to undo risk?
They must have some experience and references. For example here on BP each profile has "References" section where my clients can write about their experience. You can also check their LinkedIn profile, etc. The bottom line they should at least give you couple names of those they've done business in the past...
Definitely check their references like Dmitriy said. They should have some credibility behind their name and business. I notice many private lenders aren't running around announcing they are private lenders. The good ones are low key and don't NEED your business but willing to invest if the deal makes sense for them also. You have to put in a little work to find them and build that relationship. Here on BP is good start. Best of luck!!
@Joseph Zimlich I have a sure-fire way for you to figure out “statistically” which of those it is. Here it is:
- If someone on the internet, that you’ve never met, initiates the contact with you, and claims to be a private lender, and asks you to please borrow money from them, at an interest rate that’s anywhere in the 4-6% range, then statistically...
There is a 100% likelihood that it is a scam.
Seriously, it just doesn’t work that way. So remember that, and you will hopefully avoid losing your hard-earned money (and/or having your identity stolen) when getting these types of email solicitations.
I have posted on this topic quite a few times in the past so that BP users like yourself won’t get ripped off. To avoid re-typing everything again here, here’s just a few prior threads you might check out (my responses in these have tips and links to other helpful posts):
(1) You should make sure you are dealing with a lender versus a broker. If they are a broker, any commitments they are making with respect to timing and funding are not fully within their control.
(2) Ask to speak with current references.
(3) Search the public domain for any reviews of the prospective lender.
(4) Ask how long the lender has been in business (determine if they have a proven track record).
(5) Inquire as to the nature and amount of ALL fees that will be charged.
(6) Find out if there is a prepayment penalty.