So I have an issue to discuss regarding sharing info on deals online. Since the whole basis of this practice is essentially the 'hunt' for good deals, does anyone else worry about how much info to share?
Has anyone ever lost a deal because someone swooped in on you? Did you suspect it was due to oversharing?
With these new crowdfunding lenders, how restricted or regulated are they regarding info sharing? I would hate to lose a deal while looking for funding because someone heard about the deal and back doored me.
I have had a couple examples of this in my experience, and wonder if anyone else has a story to share.
One example is I was a remodeling contractor in my youth. I bid on a rehab that included other trades. The customer wanted detailed bids as to my subs, my youth and inexperience allowed me to proudly share who they were and their experience. Next thing I knew, the customer hired them all independently using my bid numbers and cut me out of the deal.
Another example was I was looking at a property I really liked, decided to offer. My wife and I at the time were just starting out and were looking for funding options. One of the people we were sent to for funding instead bought the property themselves, saying we didn't qualify for a loan anyway.
Both of these experiences has made me a little paranoid about sharing specific info too soon, and in fact I was a little nervous about Bigger Pockets membership having my location posted in my profile. For example if I were sharing about a specific property in my area for feedback, it wouldn't be too hard for someone to figure out the property and swoop my deal.
One crowd funding source has as the first question the address of the deal. I know that is required info, but how safe do I feel with these new type lenders with my deal? I mean it could be that they hear about a deal through the application process and cherry pick for a partner investor.
How do I lock up a deal, to protect it from being swooped before I can arrange funding?
Hello @Neal Little ,
I worry about this as well. Just make sure you surround yourself with people you trust. For instance, almost everyone at our group has a farm area they focus in. We are mostly small so going into other farm areas isn't beneficial.
As for funding. We had a hard money lender come in and speak with us about that. He said he doesn't invest in real estate because he doesn't want to be a direct competitor. He would clean up seeing how him and his partner have 30-50 million dollars to lend.
My advice is to surround yourself with people that want to see you succeed, because when you succeed they make money as well. It has to be a win-win situation for all parties involved. Don't forget that this is a business built on your word and who you are as an individual. Keep your character strong and you will be rewarded because people will notice that and want to work with you.
Also, make sure you have your funding in line before you find a house you love. If you have a strong cash offer and you're the first one there, its hard to beat. (Cash offer= hard money lender I'm assuming?)
I worked with RCN Captial for my first deal and I sent them all the information. Don't be worried, find a credible lender and get pre-approved. They are nationwide as well. Remember, choose a lender that has your best interest in mind. They are just one lender, pick the best one for your goals.
Best of luck Neal!
There are a lot of sharks in this business that would not hesitate to steal a deal.
On the other hand many ask questions here about deals that they ultimately aren't ready to pull of any way, so giving details isn't really going to hurt. It will help them better evaluate the deal, if people helping have more specifics.
It doesn't take long to figure who are the people you can trust and who to be skeptical of. Network a lot both here on BP and at your local area investors groups. This is a small business and word gets around. Until you have built a relations ship of trust, then simply don't trust.
There is definitely a lot of unethical people in this business, so it is prudent to be cautious especially when discussing deals with people you do not know. It is also why it is important to work with people you trust. I have very few qualms discussing deals with a lot of people, because I know who the people are in the real estate community not to trust, and thus I dont do business nor associate myself with them.
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