Look forward to hearing any feedback from you after you've read it. It's due to release on BP next Thursday the 28th and is available for pre-order now! Thanks so much for your support!
Hi Beth, nice article. I've been using private loans for years to fund my BRRRR and flip projects. I have also been a private lender. You definitely need to analyze not only the deal as a private lender, but you need to analyze the borrower as well. The deal is just as important as the borrower. Your not only investing in a project, but in the individual as well. There is a great deal of trust that goes into this type of relationship. Looking forward to your book coming out.
Kenneth - my co-author Alex and I often have the conversation about the "jockey" or the "horse" and who you bet on as the lender. We actually just covered this on our BP Real Estate Podcast recording this week! While they aren't mutually exclusive, and to your point should be both underwritten, some lenders place more value or emphasis on the borrower (the jockey) while others may tend to underwrite more heavily on property (the horse). I'm more of the latter while Alex definitely takes on more of the jockey position. Either way you look at it, both are important to address to ensure your loans are safe and secure BEFORE to lend out funds rather than finding it out the hard way after the loan closes. Great advice you shared!
Hi Beth , that is a great article. I have done some PML's but I want to learn more on how to find people who need private money loans I would like to check out the book when it is released.
Being able to speak to prospective lenders about your projects/deals from a lender point of view is huge, in my opinion! Not enough borrowers take the time to truly understand the WIIFM (what's in it for me) for the lender and can speak adequately about how and what they will do as the debtor to safeguard their capital investment. So what you are saying is music to my ears and will certainly help you confidently raise more private capital! Would love your feedback after you've read the book!
I have to agree will @biggerpockets-155adf04659182169cf274a1f3c2c399:disqus . Part of my business is helping connect the two resources. I'd be happy to have a chat with you. Overall networking is the most important piece there. Try going to your local REIA meetups!
@biggerpockets-f3a5ccadcf864be23f2004277a73abfd:disqus My business partner and I are looking for private money for some acquisitions. I'd love to set up a time to connect with you.
Thanks Jay! You can pre-order the book from the BiggerPockets bookstore now. And it'll be officially released next Thursday the 28th! Look forward to hearing from you after you've read it and have any feedback to share!
This is 100% solid advice! The other thing to mention, aside from securing the loan with real estate as collateral, would be to ensure you have a large enough equity buffer to safeguard your principal investment in case things go sideways. This helps the lender recover late fees, default or regular interest, and legal fees if that needs to happen. Lending on a property at 100% loan to value can still be a recipe for disaster, especially with new or novice private lenders.
I’ve pre-ordered the book on Amazon. Can’t wait to read it and learn more about this highly intriguing path into real estate investing. This just might be my point of entry!
Thanks Sherri! I hope you learn a lot from it - either as a future borrower or as an aspiring private lender! Would love to hear your thoughts after you read it!
Thanks for writing the article. I’ve been a private lender for more than five years and I look forward to reading your book to learn how to get more leads and capital partners.
Hope you enjoy the book and would love your feedback on it afterwards and potentially future topics to address. This book was meant to be a primer to getting started and all the in's and out's associated with lending out your own money in a safe, secure, and legal manner. Those private lenders looking to scale out of a passive cashflow with one's own money and into more of an active income model where you are originating money from within your network, is definitely something my husband and I did together and presents many interesting challenges and considerations to think about. I look forward to writing more on this subject in the future!
I am an active flipper in Long Island, New York. I always made money on flipping by picking up way below market value house. I am also a Broker started in 1991. Experience and local market condition made me a good flipper. Looking for PMLs.
Hi Beth! I listened to your podcast episode with Alex and i would like to get some feedback from you. are you active on instagram if i send you a message?
