Creative Financing & Private Lending – Let’s Talk Deals
Rental Property Investor · Member since 2018 · 70 posts · 38 votes
Creative Financing & Private Lending – Let’s Talk Deals
Most Popular Reply
I disagree with @Jay Hinrichs. The chance that they are scammers is not 97%, it’s 100%. (Just kidding, Jay. 🤣)
Real lenders get their fees when they perform, at closing. Though this firm says their up-front fee is refundable, what do you think the chances are that they will actually honor this promise? I’ll say 0%.
Real lenders use professionals, including legitimate title and escrow or closing attorneys, as well as vetted documentation. This is in your interest as well.
Real lenders secure their loans with a lien against the property so that they are assured they will be paid back if for some reason, you can’t perform.
You found nothing more than a pretender lender, @Robert McClung III. If you ask for references, who do you think you’ll be speaking to?
14 Replies
- NY · Member since 2024 · 9 posts · 4 votes1y
Hello Joe,
As an Account Executive for a direct lender, I can confirm that the key factors you mentioned particularly LTV, DSCR and Location are essential when evaluating a project in today's market.
The most successful Account Executives tend to also be strong underwriters and mentors. We make it a point to guide our borrowers, helping them determine whether a deal is truly the right fit for them or if it may be too ambitious given their current position.
The more information we can gather from the borrower, the better we can structure the deal and identify the strongest leverage points.
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes1y
Quote from @Joe Grespin:
I've been seeing a lot of investors looking for short-term funding to close deals, cover rehab costs, or bridge the gap until a refinance or sale. With the market always shifting, having access to flexible capital can make all the difference in keeping a project moving.
For those who have used private money lenders before what terms have worked best for you? Are you structuring your deals with flat fees, interest-only payments, or equity splits?
On the flip side, for lenders in the space, how are you evaluating deals in today's market? I always look at LTV, borrower experience, and exit strategy, but I'm curious what other factors you consider before funding a deal.
Let’s share some insights, what’s working for you in 2025?
We are a lender and we evaluate based on LTV, experience and exit as well. Also if something does not pass the sniff test, we will pass on it. We recently had someone looking for a seven figure loan where they had an 8 figure property with a low loan on it, but it made no sense why they would want a high paying interest loan, with a networth that high having no cash or ability to borrow elsewhere made us very skeptical.
One other thing we consider is location and market economics and use of the property as this can also play a role in our underwriting.
7e investments53 Reviews- Investor · Indianapolis, IN · Member since 2020 · 81 posts · 13 votes1y
@Chris Seveney Hi Chris, how can I connect with regarding more lending criteria information?
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes1y
Quote from @Shango Collier:
@Chris Seveney Hi Chris, how can I connect with regarding more lending criteria information?
send me a pm
7e investments53 Reviews
- Member since 2024 · 6 posts · 1 vote1y
Hi Joe,
I have used private money a few times and like lowest points and I/O payments specially if I can include it upfront and not have to make a couple months payments. Flat fees can work in this case also if no monthly payments needed. All my deals have been at 70% ARV so most lenders like it but exact market is huge as I have tried in few markets and certain lenders wouldnt touch them as they didnt like those markets.
Curious if anyone has ever used or worked with Lotus Assets Management LLC out of Kissimmee, FL. They were one of a few lenders offering 100% purchase and full rehab in Chicago, which most lenders are staying away from currently, but have an upfront fee after loan approval before funding. Company looks legit and registered win FL and with SEC for investments but hesitant with upfront fee.
- Lender · Chicago IL · Member since 2020 · 358 posts · 230 votes1y
Quote from @Robert McClung III:
Hi Joe,
I have used private money a few times and like lowest points and I/O payments specially if I can include it upfront and not have to make a couple months payments. Flat fees can work in this case also if no monthly payments needed. All my deals have been at 70% ARV so most lenders like it but exact market is huge as I have tried in few markets and certain lenders wouldnt touch them as they didnt like those markets.
Curious if anyone has ever used or worked with Lotus Assets Management LLC out of Kissimmee, FL. They were one of a few lenders offering 100% purchase and full rehab in Chicago, which most lenders are staying away from currently, but have an upfront fee after loan approval before funding. Company looks legit and registered win FL and with SEC for investments but hesitant with upfront fee.
How interesting they charge a fee BEFORE closing.
I've never worked with a lender who employs this strategy. I'd recommend speaking with some of their past borrowers to hear the pros and cons, if the lender will share that info with you and you can actually validate that the borrowers worked with them before. It sounds convenient, and how nice to have 100% financing... However, as I'm sure you know, there are additional ways to fill that gap that traditional HMLs leave us with (15-20% cash equity to close) that don't require an 'up front fee', like equity partnerships, gap funders, etc.If you don't close (for whatever reason, even due to no fault of your own - ie perhaps the seller changes their mind), is that fee refundable?
- I’ve heard of many scams of fake lenders that charge a fee before closing and then disappear.
Quote from @Jennie Berger:
Quote from @Robert McClung III:
Hi Joe,
I have used private money a few times and like lowest points and I/O payments specially if I can include it upfront and not have to make a couple months payments. Flat fees can work in this case also if no monthly payments needed. All my deals have been at 70% ARV so most lenders like it but exact market is huge as I have tried in few markets and certain lenders wouldnt touch them as they didnt like those markets.
Curious if anyone has ever used or worked with Lotus Assets Management LLC out of Kissimmee, FL. They were one of a few lenders offering 100% purchase and full rehab in Chicago, which most lenders are staying away from currently, but have an upfront fee after loan approval before funding. Company looks legit and registered win FL and with SEC for investments but hesitant with upfront fee.
How interesting they charge a fee BEFORE closing.
I've never worked with a lender who employs this strategy. I'd recommend speaking with some of their past borrowers to hear the pros and cons, if the lender will share that info with you and you can actually validate that the borrowers worked with them before. It sounds convenient, and how nice to have 100% financing... However, as I'm sure you know, there are additional ways to fill that gap that traditional HMLs leave us with (15-20% cash equity to close) that don't require an 'up front fee', like equity partnerships, gap funders, etc.If you don't close (for whatever reason, even due to no fault of your own - ie perhaps the seller changes their mind), is that fee refundable?
- Rental Property Investor · Member since 2018 · 70 posts · 38 votes1y
Quote from @Jennie Berger:
Quote from @Robert McClung III:
Hi Joe,
I have used private money a few times and like lowest points and I/O payments specially if I can include it upfront and not have to make a couple months payments. Flat fees can work in this case also if no monthly payments needed. All my deals have been at 70% ARV so most lenders like it but exact market is huge as I have tried in few markets and certain lenders wouldnt touch them as they didnt like those markets.
Curious if anyone has ever used or worked with Lotus Assets Management LLC out of Kissimmee, FL. They were one of a few lenders offering 100% purchase and full rehab in Chicago, which most lenders are staying away from currently, but have an upfront fee after loan approval before funding. Company looks legit and registered win FL and with SEC for investments but hesitant with upfront fee.
How interesting they charge a fee BEFORE closing.
I've never worked with a lender who employs this strategy. I'd recommend speaking with some of their past borrowers to hear the pros and cons, if the lender will share that info with you and you can actually validate that the borrowers worked with them before. It sounds convenient, and how nice to have 100% financing... However, as I'm sure you know, there are additional ways to fill that gap that traditional HMLs leave us with (15-20% cash equity to close) that don't require an 'up front fee', like equity partnerships, gap funders, etc.If you don't close (for whatever reason, even due to no fault of your own - ie perhaps the seller changes their mind), is that fee refundable?
Totally agree. I’ve also never worked with a lender that charges a fee before closing. Verifying past borrowers sounds like a smart move, especially if the fee isn’t refundable.
- Rental Property Investor · Member since 2018 · 70 posts · 38 votes1y
Quote from @Jennie Berger:
Quote from @Robert McClung III:
Hi Joe,
I have used private money a few times and like lowest points and I/O payments specially if I can include it upfront and not have to make a couple months payments. Flat fees can work in this case also if no monthly payments needed. All my deals have been at 70% ARV so most lenders like it but exact market is huge as I have tried in few markets and certain lenders wouldnt touch them as they didnt like those markets.
Curious if anyone has ever used or worked with Lotus Assets Management LLC out of Kissimmee, FL. They were one of a few lenders offering 100% purchase and full rehab in Chicago, which most lenders are staying away from currently, but have an upfront fee after loan approval before funding. Company looks legit and registered win FL and with SEC for investments but hesitant with upfront fee.
How interesting they charge a fee BEFORE closing.
I've never worked with a lender who employs this strategy. I'd recommend speaking with some of their past borrowers to hear the pros and cons, if the lender will share that info with you and you can actually validate that the borrowers worked with them before. It sounds convenient, and how nice to have 100% financing... However, as I'm sure you know, there are additional ways to fill that gap that traditional HMLs leave us with (15-20% cash equity to close) that don't require an 'up front fee', like equity partnerships, gap funders, etc.If you don't close (for whatever reason, even due to no fault of your own - ie perhaps the seller changes their mind), is that fee refundable?
Great points. That upfront fee before closing definitely raised a red flag for me too.
I’ve never had a lender structure it that way either, which is why I’m treading carefully. I agree—it’s worth trying to talk to a few past borrowers if they’re willing to connect me, and making sure they’re legit and not just referrals they control.
On paper, 100% financing sounds amazing, especially in a market like Chicago, where a lot of lenders are pulling back. But you’re right—there are other ways to cover the gap without risking upfront cash. I’ve done a few deals using gap funding and equity partners, and while it’s a little more legwork, at least the risk is shared.
And yeah, that’s a key question: what happens if the deal doesn’t close? Is that fee refundable or just gone? I’ll dig into their terms more and see if they’ll put that in writing.
Appreciate the insight—helps to have a gut check from others doing deals.
- Member since 2024 · 6 posts · 1 vote1y
The contract is pretty straight forward and he says the fee is refundable but not in the contract. He wont close through Escrow either which is super weird and he doesnt want a mortgage lien which ultimately is more risky for him and its just a business loan with personal guaranty and promissory note. Just all seems fishy but all his information matches state business license and info. Im just not willing to take risk I guess and going with gut instinct.
- 1yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Robert McClung III:
The contract is pretty straight forward and he says the fee is refundable but not in the contract. He wont close through Escrow either which is super weird and he doesnt want a mortgage lien which ultimately is more risky for him and its just a business loan with personal guaranty and promissory note. Just all seems fishy but all his information matches state business license and info. Im just not willing to take risk I guess and going with gut instinct.
U my friend I will be 97% that this is a fake lender and will do the pump and dump advanced fee scheme that is so prevalent in the US Sand has been for decades frankly my Dad warned me of these companies in the late 70s.. Very large commercial loans many times will have a flat 10 to 30k up front fee.. but those are companies that are easily verifiable.
100% financing with a unsecured NOTE is simply a scam.. No one in their right mind does this unless they are doing it with a long time client that is known well and trusted. I disagree with @Jay Hinrichs. The chance that they are scammers is not 97%, it’s 100%. (Just kidding, Jay. 🤣)
Real lenders get their fees when they perform, at closing. Though this firm says their up-front fee is refundable, what do you think the chances are that they will actually honor this promise? I’ll say 0%.
Real lenders use professionals, including legitimate title and escrow or closing attorneys, as well as vetted documentation. This is in your interest as well.
Real lenders secure their loans with a lien against the property so that they are assured they will be paid back if for some reason, you can’t perform.
You found nothing more than a pretender lender, @Robert McClung III. If you ask for references, who do you think you’ll be speaking to?
- 1yAaron ZimmermanBusiness MemberAccountant · Chicago, IL · Member since 2018 · 2k+ posts · 1k+ votes
As with anything, it's absolutely crucial to vet your lenders by getting multiple referrals. Speaking with investors, they're looking at ARV/spread between purchase and ARV. For lenders, they're looking at ARV and also track record of the sponsor to see if they can execute.
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