Debt Partner Agreement Wording

[Ben Wilkins]

Good evening all,

I am currently looking at using a private lender as a debt partner. I just closed on a quad using my own money, and have an opportunity to purchase a tri from another investor. He has offered to lend the money for closing, so I was wondering:

• How is an agreement usually worded between someone in my position, and the lender?
• Assuming a six-month lending period
• How is the interest usually handled? I'll be honest - I originally said to him "10 percent for six months", but I was using generic terms and don't know exactly what that meant. Is it handled with a standard mortgage-payment equation, with annual interest of .10/12 and six payment periods?

Any advice on how to word an agreement would be appreciated.

[Alex Deacon]

@Ben Wilkins and @Bret Bascue you have a very simple problem to solve. Hire a very good reputable attorney to draft the paperwork. I draft mortgages and notes all the time now for myself but started with using my attorney. The cost will be paid for by the borrower. You will need a two page Note. A 5-10 page Mortgage document and possible a personal guarantee document prepared.