WHY I LOVE PRIVATE MONEY LENDERS

[Don Scott]

I started investing in real estate over 8 years ago and I have done all kinds of deals.  

I started as a landlord and buying Rentals.  Then, I started wholesaling and flipping properties (currently doing about 50 transactions a year over the last couple of years).  

I have also Owner Financed a couple of properties, own some Multi-Family (currently have a deal under contract and looking to close 3-4 more before the end of 2020), and a co-owner in a Tiny Home Park.  There is more, but this post isn't about that LOL...

I didn't actually start using Private Money until only 3 years ago!  I had a very good friend, who flips over 50 houses a year, tell me about Private Money Lenders and I haven't looked back!

Now, I fund the majority of my real estate deals with Private Money.

I’ve borrowed & repaid millions of dollars from my investors.

Not all of my deals have gone as expected, but if you do enough deals then you understand that is a part of the game.

I’ve lost money on a few here and there and I'm sure it will happen again.

But here’s what I’m most proud about in my real estate career: MY LENDERS HAVE NEVER LOST A PENNY!

So even when I’ve taken hits on some of my deals, my lenders have always received 100% of their capital AND Interest that was promised to them.

*And I will note that I have a fairly conservative/cash-flow approach to real estate and always have at least 3 exit strategies on every deal, just in case…if you're considering becoming a private lender, I would strongly encourage you to get to know your borrowers AND their investment strategy [critical]

**I apologize for the long post, I just wanted to share how my Private Money Lenders changed my life as an investor.

[Lisa Eckman]

I'm looking at offering private money loans and wonder if you can provide some advice on what's really necessary for me, as the lender, to protect my interests. Everyone's trying to keep costs to a minimum, so a lot of the safeguards might go by the wayside:

 - Is it really necessary for me to have an attorney involved?  

- Is it really necessary to have a new title policy when you have one dated within the last 6-12 months (for example, when the owner purchased the property initially and is now rehabbing)?  Yes, I know that something could have changed during that time.  But you can say that about a property that has a title policy as of a week ago. I guess the difference is that the title policy would pay up if necessary were you to have a current policy?  

I would have a 1st lien recorded on a property that has 65% LTV. However, tax and mechanics liens take priority. So there are always risks. Just trying decide what is truly necessary.

Thanks for your advice!

Lisa