Updated 2 months ago on .
Make sure you're covered even in a zombie apocalypse 🧟♂️
Seriously though, as a private lender your protection doesn’t come from hoping the market stays strong. It comes from the margins baked into the deal before you ever write a check.
If a property is purchased at $15k, rehabbed for $20k, and the finished value is $80k, even if the market tanks hard and that property loses 40% of its value, you’re still covered on your $35k. The math works even in the worst case.
The deal should only get approved if the spread between what everything costs and what the finished property is worth is wide enough to survive even a serious market correction.
When the deal is structured correctly, newly educated lenders and experienced lenders alike are protected and profitable.