I'm located in the Detroit area and will be borrowing private money for upcoming deals. This will be my first time funding a project this way. From looking in for forums, the common advice seems to be to talk to an attorney and that the structure needed consists of a promissory note and a mortgage document. Am I missing anything? I spoke to an attorney who seemed to think that I needed to create a different LLC in partnership with each private money lender and that we also needed some disclosure documents. Does anybody do this? Or is he looking to bill me for more than I need? Also, if anybody has experience with an attorney in Michigan who knows how to do this, please let me know. Any help/ advice on this topic is appreciated.
I am a licensed private money lender in California and I know regulations can vary state to state. However, my father who is my Broker, has been doing Private Money loans for over 25 years and if you find a licensed and experienced Broker who offers private money, you do not have to work with an attorney.
If you want to work with investors directly to "cut out any middle man", then it would be very beneficial to also find a local, licensed Broker who can then draw up all the legal documents for the both of you. The Broker will charge some fee for drawing up the documents and all, but this will ensure everything is legal yet not cost as much as attorney fees.
Hope the above is helpful.
Sun Pacific Mortgage & Real Estate
I have never seen the need for a borrower to set up an LLC. I would get a second opinion from someone else.
Nice. Thanks for the advice. Any other thoughts?
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