Has anyone in BP EVER borrowed this Private Money Lender Jesse??

Private Lending & Conventional Mortgage Advice

Has anyone in BP EVER borrowed this Private Money Lender Jesse??

Flipper/Rehabber · Miami, FL · Member since 2016 · 102 posts · 12 votes

Jesse Gerads who is a PRO Member here on BiggerPockets is offering to loan Private Money at terms that appear too good to be true. Has anyone here in BP EVER borrowed from him? I'm now communicating with him via emails.

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Chris MasonPro Member

Moderator

Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes

10y

Originally posted by @Account Closed:

Issac, his name is under the lender tab on BP. He's listed as private lender. Does BP vet the folks that claim to be lenders?

<-- This guy received zero vetting prior to being allowed to put "lender" next to his name, so no there is no vetting that I'm aware of.

It could just be paid advertising to be on that list/tab, or there could be vetting for it, IDK.

However:

If the dude does more than X mortgages per year, he's supposed to be licensed or registered (I've never been anywhere near that threshold and was licensed before I did my first, so don't know what X is).

You can click on my profile, look at my email address, figure out my full name in about 3 seconds, and look me up on the NMLS Consumer Access website. From there you can see how long I've had my license, if I've ever had any disciplinary issues with the regulators, official consumer complaints, that sort of thing.

If he's licensed, or ever was licensed, it'll be the same thing for this fellow. A single ethics complaint could just mean an unhappy or unreasonable customer - hey, it happens. Anything resembling a pattern, run for the hills.

http://www.nmlsconsumeraccess.org/

Same sort of thing for realtors. Takes like 5 seconds to see if any realtor has ever had any ethics complaints, lapses in licensing, etc. In California the relevant google search is "California BRE lookup" and it'll be the first result. I've actually done this when my "this feels sketchy" alarm went off, and found a guy pretending to be a real estate agent that had been kicked out of the industry and had his license permanently revoked a decade prior. I have no idea what I saved that homebuyer/borrower from, but I'm sure it wouldn't have been anything particularly nice.

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Isaac Blocher
Property Manager · Orlando, FL · Member since 2015 · 257 posts · 58 votes
10y
I just did a search here on BP for his name and it does not come up!
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Account Closed
Hackettstown, NJ · Member since 2015 · 192 posts · 26 votes
10y
Dan,
I'm also in communication with him and you are right, it does seem to good to be true. He has asked for a copy of my license as verification of who I am. I'm not sure how to proceed from here. I searched him on FB but the person I found doesn't quite look like him so that didn't pan out as I hoped. I'm in need of a small rehab loan and really would love this guy to be legit.
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Account Closed
Hackettstown, NJ · Member since 2015 · 192 posts · 26 votes
10y
Issac, his name is under the lender tab on BP. He's listed as private lender. Does BP vet the folks that claim to be lenders?
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Percy N.
Developer · Philadelphia, PA · Member since 2015 · 2k+ posts · 904 votes
10y
@Account Closed to by knowledge does not vet anyone (and I don't think they necessarily should).
What terms where offered? That itself will tell you a lot.
Ask for his number and look it up to verify it belongs to the business.
If they are a licenses lender, ask for their license number, but not all lenders need a license.
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Account Closed
Hackettstown, NJ · Member since 2015 · 192 posts · 26 votes
10y
Originally posted by @Percy N.:

@Account Closed to by knowledge does not vet anyone (and I don't think they necessarily should).
What terms where offered? That itself will tell you a lot.
Ask for his number and look it up to verify it belongs to the business.
If they are a licenses lender, ask for their license number, but not all lenders need a license.
Good point...this guy is representing himself as a Private Lender. He charging 5% interest only loans. He ask for basic info and a copy of your license.
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Chris MasonPro Member
Moderator
Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
10y
Originally posted by @Account Closed:

Issac, his name is under the lender tab on BP. He's listed as private lender. Does BP vet the folks that claim to be lenders?
<-- This guy received zero vetting prior to being allowed to put "lender" next to his name, so no there is no vetting that I'm aware of.
It could just be paid advertising to be on that list/tab, or there could be vetting for it, IDK.
However:
If the dude does more than X mortgages per year, he's supposed to be licensed or registered (I've never been anywhere near that threshold and was licensed before I did my first, so don't know what X is).
You can click on my profile, look at my email address, figure out my full name in about 3 seconds, and look me up on the NMLS Consumer Access website. From there you can see how long I've had my license, if I've ever had any disciplinary issues with the regulators, official consumer complaints, that sort of thing.
If he's licensed, or ever was licensed, it'll be the same thing for this fellow. A single ethics complaint could just mean an unhappy or unreasonable customer - hey, it happens. Anything resembling a pattern, run for the hills.
http://www.nmlsconsumeraccess.org/
Same sort of thing for realtors. Takes like 5 seconds to see if any realtor has ever had any ethics complaints, lapses in licensing, etc. In California the relevant google search is "California BRE lookup" and it'll be the first result. I've actually done this when my "this feels sketchy" alarm went off, and found a guy pretending to be a real estate agent that had been kicked out of the industry and had his license permanently revoked a decade prior. I have no idea what I saved that homebuyer/borrower from, but I'm sure it wouldn't have been anything particularly nice.
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Ilona Kovacs
Private Lender · Port Chester, NY · Member since 2015 · 106 posts · 19 votes
10y
Be very wary of "too good to be true" deals, like saying they will finance 90-100% of your deal.... It's just a ploy to get you into their office and then they let you down and say, "oh yeah well, you don't qualify and its really this and that,etc"....
"Lenders" like that make us look like sharks, when in reality, in our case, at least, we want repeat borrowers and build relationships
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Chris MasonPro Member
Moderator
Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
10y
Originally posted by @Ilona Kovacs:
"Lenders" like that make us look like sharks, when in reality, in our case, at least, we want repeat borrowers and build relationships
Yup, agreed. All about relationships.
As borrowers, you folks can also ask for a list of references. You can, zomg, call those references just like you would call a tenant's references. Imagine that.
"Hey Realtor Jane, I'm already set for an agent, but can I have 30 seconds of your time anyways? I'm not trying to sell you anything." (realtors get more solicitation phone calls than any other profession, so lead with that to get your 30 seconds)
"Erm... sure, I guess?"
"Awesome, thanks. Do you ever work with Lender Joe?"
"Oh [light bulb clicks on for purpose of call]. Yup, he's helped several of my clients in the past."
"He ever screw anyone over?"
"Nope, that's why I continue to refer business his way. Good luck on your transaction!"
If you start by saying "you aren't getting a commission check out of me no matter what," the realtor has no incentive to lie. Just like when you call that potential tenants former landlord from two apartments ago -- that tenant isn't living in that landlord's property any longer, so that landlord has no incentive to lie if that tenant is a crummy tenant.
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Al Brown
Investor · Egg Harbor City, NJ · Member since 2016 · 2 posts · 0 votes
10y
I am also in communication with Jesse and feel uneasy as well regarding the tone of his responses. I even received a email back from another lender with an pre-eval based on some information I provided to him. Its certainly seems shady.
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
10y
@Ilona Kovacs I think whats happening is newer investors don't really know what they don't know.. specifically that there is no way the are going to borrow money at bank rates with 90 top 100%.. and that NO private lender ( unless its your parents or very very close relative or friend) will do the same.
Not saying it could never happen as some folks may not realize the risk of that.. But normally all lending is risk reward related.. so if your HIGH LTV with someone who is newer or not proven your return Is going to be very high.. Not super low.
for instance I borrow from banks for my activities.. 1 point and 5.5% with a bank in Charleston for new build.. and in Oregon 1 and 6... In Oregon were I am well known I can get 90% of cost but I usually only borrow 70% since I paid cash for the land and don't need to pull cash out. IN Charelston were I am out of state and to my knowledge the only borrower that bank has that is out of state. they require 30% of COST. Nothing is done on ARV ...
Once folks realize that there is no unicorn lenders for those starting out or with little expreince or track record the sooner they will configure themselves to do deals.. ID is red flag central.. Title co's may ask for it. and Lenders when your loan docs are there.. but not in the beginning and certainly not a Private money lender..
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Jerry Padilla
Lender · Rochester, NY · Member since 2014 · 3k+ posts · 1k+ votes
10y
@Jay Hinrichs
Is right on point. When we went hard money for short period of time, we paid 12% interest and 2 points upfront. That was a "decent rate" for hard money. I know others that charge 16%. He was also referred to me and well known in the community and I did as much research on him as I could. At the time I had 2 houses under a $50k loan, that was only about 25% LTV. It was a win win for him to foreclose. Everything worked out well and we refinanced conventional. But I knew other attorneys and loan officers that knew him. I personally wouldn't borrow money from someone that I was hesitant about. Do your research on him as Chris said above. Check public records for lawsuits and foreclosures.
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
10y
@Jerry Padilla we did a loan with Lending home.. I was going to be a correspondent with them but it was too much work for a point.. but based on my experience level I was able to get 2 points and 8.2 % that's about as good of hard money as I have seen.. some guys in SF and LA are 1 and 9 or so.
still needed equity though and we have to front the draws and get reimbursed.. so it takes quite a bit of capital to get the lower rates from these guys.. so far they are pretty decent though. With out bank loans of course its different subs they wait and get paid when we get paid they only need to be paid once a month... Most rehab contractors can't float a job more than 10 minutes so you need to pay some in advance to get them working and keep them working.
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Steve Haight
Las Vegas, NV · Member since 2014 · 732 posts · 137 votes
10y
Following this thread, what about the lenders that ask for money up front? Here there are a few of these guys learking on BP!
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Chris MasonPro Member
Moderator
Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
10y
Originally posted by @Steve Haight:

Following this thread, what about the lenders that ask for money up front?
"Up front" as in just to get a commitment or preapproval letter? Hell no.
"Up front" as in "when/if the loan funds"? Different story.
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Manolo D.
Contractor · Los Angeles, CA · Member since 2015 · 4k+ posts · 1k+ votes
10y
Originally posted by @Jay Hinrichs:

@Jerry Padilla we did a loan with Lending home.. I was going to be a correspondent with them but it was too much work for a point.. but based on my experience level I was able to get 2 points and 8.2 % that's about as good of hard money as I have seen.. some guys in SF and LA are 1 and 9 or so.
still needed equity though and we have to front the draws and get reimbursed.. so it takes quite a bit of capital to get the lower rates from these guys.. so far they are pretty decent though. With out bank loans of course its different subs they wait and get paid when we get paid they only need to be paid once a month... Most rehab contractors can't float a job more than 10 minutes so you need to pay some in advance to get them working and keep them working.
So true, some subs can float for a month, they also tend to be more expensive. Some have capacities but weed out 30/60/90 clients and accept 15-30 instead, longer term means we need more margin, the more turn overs we can multiply the more income we get, we all have the same goal, the more we could rinse and repeat, the more we earn, it doesn't really matter what role you will be playing (lender, flipper, contractor), the pattern is the same. In CA, there is too many jobs than that of workers.
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Daniel DeBono
Residential Real Estate Broker · Lake Placid, FL · Member since 2016 · 8 posts · 0 votes
10y
Perhaps they do not vet but if there are known scams, they should be dealt with! This looks like a total scam.
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Daniel DeBono
Residential Real Estate Broker · Lake Placid, FL · Member since 2016 · 8 posts · 0 votes
10y
@Chris M. Tried to get you email from your profile - did not see it.
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Daniel DeBono
Residential Real Estate Broker · Lake Placid, FL · Member since 2016 · 8 posts · 0 votes
10y
I emailed a couple times "fishing" - he sent back (quickly) a letter. I then received an email he was sorry I thought him a possible scam. Thing is, it was long, looked to be cut and pasted for such emails as mine and not the best English - HUGE red flags...
I guess there is a .001% chance he is legit, but that is most likely FAR too high ...
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Daniel DeBono
Residential Real Estate Broker · Lake Placid, FL · Member since 2016 · 8 posts · 0 votes
10y
Anyone know of any legit private lenders in Florida (especially with longer terms)? A couple clients with income, assets but only fair credit looking to get in on buying and flipping but even more, buying/renting...
Most of my clients (including investors) use cash so I do not have that much experience with hard money lenders. A couple investors I worked with used them with success and I will contact a couple but thought a couple were terrible.
Just wanted to know if anyone knew any good/fair (not too good to be true) options ...
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
10y
@Daniel DeBono Private lenders by definition are those that are private IE you know them .. they don't advertise for loans.. they generally have smaller amounts to loan maybe out of the IRA.. they are not in the business.
Anyone who advertises to loan money.. is on its face a HML.. be them individual or "private" they are in business of soliciting for loans..
And yes BP has disclosures on the market place to watch out for these yahoo's ... they are all fee up front never hear from them again or they just turn you down. and say your deal did not work and you out the few buckaroos you sent them with the dream of landing a no money down under market deal.
REALITY is .. HML requires down payments period.. ( unless your on your 10 to 20th loan with a company I have seen HML then go to ARV) but starting a new relationship.. you will waste an inordinate amount of time chasing down this unicorn that does not exist instead what I would recommend is using that same time and effort to find a money partner so you can go to a Legit HML and put your deal together.. If the deal is not profitable at 2 and 12 then its no deal anyway.
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Emily Lopez
Real Estate Broker · Rock Springs, WY · Member since 2015 · 57 posts · 43 votes
10y
If in doubt, don't.
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Andrew Halbert
Macomb, MI · Member since 2015 · 141 posts · 45 votes
10y
I called him out on his thread. He did not respond.
His will ask you for money upfront before lending you anything...........
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Daniel DeBono
Residential Real Estate Broker · Lake Placid, FL · Member since 2016 · 8 posts · 0 votes
10y
Tnx, I knew all that but appreciate the answers. By "up front" I mean fees to to simply get going and this guy has that - like I said: Just looking at this thread and his emails to me, I am as sure as I can be it is a scam.
(Obviously being a broker/owner of a successful real estate firm for 11+ years, I do understand "real" up front fees such as down payments, appraisals, etc.)
Most of my clients are cash buyers or conventional loan people but I do have some with good income/assets and not great credit we are looking for options for.
Thx again!
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Martha Blumel
West Palm Beach, FL · Member since 2015 · 85 posts · 4 votes
10y
I actually contacted him a few days ago, and yes it does seem too good to be true. I googled his name and number and this other thread popped up.
https://www.biggerpockets.com/forums/517/topics/286125-loan-offer
Plus I clicked on his phone number link in the email he sent me and it connected to Skype.
Total scam in my opinion.
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Gina Williams
Upland, CA · Member since 2015 · 18 posts · 20 votes
10y
Yes, I guess the English is ok....but his response seemed abrupt. It's something that doesn't feel right. I tried contacting him and received this email back. see below:
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