Private VS HML??

[Edwin E.]

Jon Holdman, or anyone for that matter, I have a question for you (all). I've been reading on BP concerning HML interest rates in concern with usury loans. I understand that each state has its limit of what is considered an unscrupulous loan. In FL, where I am at, the rate is no more than 18% annualized. I am not an accountant so I am not extremely clear on how the rate can be broken up but from what I understand the total points and annualized rate cannot exceed 18%. Now when I had first begun in RE I had met some rehabbers that had a deal worked out with, what I assume now to be Private money. Where the Private source would fund the acquisition + rehab, or just one of the other, with an interest against the equity when sold, like 50% of the profits for example. Obviously that would break the predatory lending rule of an annualized 18%.

Am I missing something or is this State resolved? Are these type of loans only allowed to be established via Private money (the percentage of profits) and not HML? Would the combination of the two break the law? A lot of questions, and I trust you will give a full explanation, (I've been reading your post so I know that will be the case :) thank you very much sir and God Bless