Hi all-

I've been looking to get a bridge loan from private money lenders but have noticed there are a ton of scammers online claiming to be legit.  Any advice on how to find actual private money lenders?  Also, would a legit lender ask for money upfront?  (I'm guessing no, but I'm also new to using private lenders).

Thanks for your help!

You can search for HMLs here on BiggerPockets. 

https://www.biggerpockets.com/real-estate-companies/hard-money-lenders

@Tim Woodbridge I’ve spoken to a few lenders on here and some wanted $125-250.00 up front just for an application. I never did use them. I wasn’t paying 125-250.00 Etc...for an application. So, yes, you’re going to come across some wanting money up front. 

Yes. We do for instance. It helps sort the chaff from the wheat.

What we also have is a cadre of happy past borrowers who are willing to take a phone call and vouche for us and describe how their loan process went.

@Benjamin Hurwitz: how does that work?  Do you put the money into a third party escrow account?

Originally posted by @Tim Woodbridge :

@Benjamin Hurwitz: how does that work?  Do you put the money into a third party escrow account?

No. It is a non refundable payment. (Though in the unlikely event that a deal does not close we will credit it to a future loan). The money is for the honour of my underwritering team beginning the underwriting process on your loan.

*Takes a deep breath before stepping on the soap box*

We did not used to take such a fee and found we were inundated with tire kickers. The suggestion (elsewhere on BP) that borrowers paying for an appraisal shows sufficient good faith also has sadly not proven true. So now if people want their loan to go before my underwriting team they can have skin in the game or go elsewhere.

For our business model we have found the majority of our business is through mortgage brokers. They have seen us repeatedly service their clients and are happy to assure new clients that we are legit. 

I can also tell you a whole litany of instances where the borrower was found, last moment, to have lied on their application form, or for instance a few weeks ago even one that went AWOL on closing day and didn't bother to communicate for two weeks (A $10M deal and even with an upfront payment BTW). We want the borrower to have skin in the game! Otherwise there are other places to go to.

Best wished in your RE endeavours.