Private Money Lending

[Priya Srinivasan]

I'm borrowing money from a private money lender to close on a quadplex. He mentioned he will transfer the money to my account and not the title company. Is that okay? Also this is my first time with private lenders. What should all I check or verify before signing? Thanks in advance.

[Jeff S.]

Sure???

No, it’s not ok, @Priya Srinivasan. You provided no information, but this is one indicator of either a scam or a lender who has no idea what they are doing. What legitimate lender doesn’t want lenders title insurance and to have their money properly disbursed by a neutral party?

How well do you know this person? (Please don’t say you met him online and/or you are paying upfront fees 😬).

There have been many posts on vetting lenders. You might start with this recent post, that also addresses your question:

1 time lending money as a private lender use of title company?

Then, read this one and click the links for questions you might ask to vet a private lender:

Seeking hard money lenders, Do’s and Dont’s