New and Need Private Lending Advice

[Edward Stewart]

I'm looking to get into rental properties and flipping, but since I am a soon to be graduate from college obtaining a traditional loan doesn't seem to be the path I'll be able to take at first. I have the option of private money loans through family/friends, but would like some advice on how to make the terms fair to myself and them on rental properties. Any advice in this situation would be highly appreciated, thanks!

[David Benton]

@Edward Stewart, Family and friends are who I started with as well. I did flips and I always gave them an equity split in the deal or preferred interest such as 12-15%. If doing rentals you probably want to be a bit conservative as in 6-8% so that you cash flow but that would depend on the type deal structure you are doing as well. There are a lot of variables that can come into play such as seller financing, subject to existing financing etc... Cash flow can make or break.