How to become a hard money lender?

How to become a hard money lender?

Spring Hill, FL · Member since 2017 · 33 posts · 6 votes

I am not looking to start my own business in hard money lending, im wondering if there are any companies that work with investors such as myself? I have heard there are companies that allow you to diversify across multiple hard money loans and pay good interest.

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  • Lender · Syracuse, NY · Member since 2016 · 165 posts · 92 votes
    8y

    @George Leeman The best advice you'll ever receive is to stay with a larger, more established, company. HML by it's very nature is private. Few regulations and fewer laws exist in this space - You'll be at the mercy of the HML to provide whatever reporting they wish and you may never know what their return was (vs. yours). At least with a larger firm (some of which are on BP) you'll have audited financials.

  • Darrin CareyPro Member
    Lender · Dayton, OH · Member since 2008 · 1k+ posts · 705 votes
    8y

    @George Leeman There are multiple companies that allow you to do just that via the crowd funding websites. They are one step removed from the deal though, and the details can be harder to evaluate. 

    Alternatively, you can work directly with a Hard Money Lender to pick and choose individual note(s) to fund. Then you have all the details on a specific borrower and property. Typically you'll need to find a local/regional lender that also works with individuals.

    The big lenders already have large sources of funds established.

  • Lender · Berkeley, CA · Member since 2017 · 1k+ posts · 549 votes
    8y

    Are you interested in investing in a HML? I know of when that paid out nearly 20% last year!

  • Spring Hill, FL · Member since 2017 · 33 posts · 6 votes
    8y
    Originally posted by @Timothy Maloney:

    @George Leeman The best advice you'll ever receive is to stay with a larger, more established, company. HML by it's very nature is private. Few regulations and fewer laws exist in this space - You'll be at the mercy of the HML to provide whatever reporting they wish and you may never know what their return was (vs. yours). At least with a larger firm (some of which are on BP) you'll have audited financials.

     can you recommend any companies to look at?

  • Spring Hill, FL · Member since 2017 · 33 posts · 6 votes
    8y
    Originally posted by @Darrin Carey:

    @George Leeman There are multiple companies that allow you to do just that via the crowd funding websites. They are one step removed from the deal though, and the details can be harder to evaluate. 

    Alternatively, you can work directly with a Hard Money Lender to pick and choose individual note(s) to fund. Then you have all the details on a specific borrower and property. Typically you'll need to find a local/regional lender that also works with individuals.

    The big lenders already have large sources of funds established.

    so you would recommend i contact hard money lenders in my area and assess the deals myself?

  • Darrin CareyPro Member
    Lender · Dayton, OH · Member since 2008 · 1k+ posts · 705 votes
    8y

    @George Leeman, That's one option.

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