Promissory Note for Using OPM

[Tyler Lingle]

Hi guys, I'm an agent in Indianapolis and honestly I'm pretty tired of helping OOS investors buy there own rentals. I'm starting my own business which will buy rentals / value add properties, and use other people's money to fund at a 10% interest. I'm mainly looking for any wisdom from others who have used promissory notes, secured by a property, and how they structured that. Do you do interest only payments? What happens when they want to pull all their money out? How often do you pay them interest? And, if I'm buying them with an LLC do you guys have experience getting a mortgage with an LLC?

[David Garner]

Quote from @Tyler Lingle:

Hi guys, I'm an agent in Indianapolis and honestly I'm pretty tired of helping OOS investors buy there own rentals. I'm starting my own business which will buy rentals / value add properties, and use other people's money to fund at a 10% interest. I'm mainly looking for any wisdom from others who have used promissory notes, secured by a property, and how they structured that. Do you do interest only payments? What happens when they want to pull all their money out? How often do you pay them interest? And, if I'm buying them with an LLC do you guys have experience getting a mortgage with an LLC?

Hey Tyler... well.dome for taking positive action for yourself. I've used OPM to buy over 100 houses since 2016. I use a note/deed specifc to my market (state). I use private money to buy, then I refi with either another private lender, or a commercial lender. I offer terms to suit the deal. If its a fully renovated house then I pay my lender a startup 9% with monthly interest. If its a rehab loan, then I pay more and sometime also structure in points at the front and/or back end.