Taking second position when lending out private money

[Tyler McDonald]

Hey all! I've got a chance to lend to someone for a rehab project. They would like to use a different property (a well performing STR) as the collateral due to the renovation project being a rental property that is on the same lot as their primary residence. I would be taking second position on the STR property if I proceeded.

-Are there any issues with a loan for property 1 being secured with property 2? 

-Also, how would I go about securing second position, go through a title company?

[Chris Seveney]

@Tyler McDonald

We always get a personal guarantee on the borrowers. So if they have other assets we can attach to that.