The anatomy of a private money loan process
I am new here and I am looking for a short brief description about how a private/hard money loan works from start to closing (typical process)...this might be helpful for both private parties that are interested in lending funds and also for borrowers looking to flip properties (what to expect)...I have outlined some questions below:
-What type of documents are usually needed for private money loans closing (they might differ from state to state)...sample docs links might be helpful (e.g. promissory note, deed of trust etc).?
-What certified parties are required on the process (e.g. attorneys, brokers, title company etc) and what the lender can do himself in order to save money?
-How the private lender is protected in the case of default, late payments etc....in other words how to reassure a potential private money lender (friend, family member) that their funds are safe (mimic the professional and experienced private/hard money lenders steps)
-What are the common terms of the loan (rate, interest only payments, length, penalties, collateral on other property equity, early/late reimbursements, etc.)