Updated almost 5 years ago on . Most recent reply
Investment agreements with private money lenders
When working with private money lenders, what is the best agreement in your opinion with regards to ROI for them? Profit-sharing? Interest rate?
What do you prefer? What do they typically prefer?
Most Popular Reply
@Matthew Ruderman First I would have a firm grasp on your goals. Then understand what your private investors goals are - because they are all different. If your investor just wants a straight up return and to be hands-off - then simple interest return at (fill in the blank) interest rate will be great for them. Especially if they currently aren't putting their money to work. But if your investor is more equity driven, finding the solution that works best for your relationship is the route I would take.
Strategy also plays a part in this (i.e. Flips, MultiFamily, BRRRR)