What kind of terms do I use to convince private lenders?

6 Replies

Was wondering how do I convince anybody to fund my deal as far as what kind of repayment terms do I write in? I have a potential deal here in NC

What kind of terms would you want as a lender? I would look to WOW them and overwhelm them with value. If you can get on their good side, they will likely work with you again, and I doubt that 1 deal will make or break your entire investing career. Put yourself in their shoes. Best of luck!

@Jonathan Toruno be knowledgeable, honest and talk to them like people. Figure out what they want

Promotion
BiggerPockets
The one-stop-shop for REI
Find Local Home Improvement Pros!
Check out our network of trusted, local contractors for all of your home improvement projects.
Find a Contractor
Originally posted by @Jonathan Toruno:

Was wondering how do I convince anybody to fund my deal as far as what kind of repayment terms do I write in? I have a potential deal here in NC

Are you using them for the down payment, in lieu of a mortgage, or both? I remember learning something to the effect of "if it really is a good deal, you wont need to convince anyone". Make a report with the current price you want to pay, show expenses (capex, vacancies, management, etc), show projected income. Show comps (to prove the projected income in realistic). Derive your cash on cash return and so on. Their are calculators for all of these things. If you want them in lieu of a mortgage, you need to both agree on a duration & rate. Someone will correct me if I'm wrong, but i think 7% is on the low end for interest on a private money loan, 12% is on the high end. Don't be unsure of yourself when speaking to them.