Updated about 5 years ago on . Most recent reply
Loaning Hard Money towards a house
Hi,
There is an investment opportunity that I have. There is a friend/acquaintance that is splitting up with his ex and needs to buy her out.
He has a 6 bedroom house which is worth $1M (Redfin/Zillow value). He needs $100K. Assuming that this is an investment that I want to do. (i've gotten all the advice about loaning money to friends).
How should I go about creating the agreement between us?
Will this be a promissory note? What should my conditions be for default - be the first lien (after the bank) ? Should i be added to the title o the house? How can I secure my investment (as much as possible)? Note that I am willing to take the risk of losing friendship and losing the money.
Also what interest rate should I charge?