Unpaid Private Loan on Texas Fix-and-Flip

Lubbock, Texas
Tax, SDIRAs & Cost Segregation
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Unpaid Private Loan on Texas Fix-and-Flip

Fernando Roman Romero
Rental Property Investor · Lubbock Texas · Member since 2018 · 12 posts · 4 votes

I made a private loan of approx. $40,000 to a friend and his partner through their LLC for a Texas fix-and-flip project. The property did not sell due to market conditions, and the repayment date has passed with no repayment.

I’m trying to handle this professionally and would prefer to formalize a repayment plan before escalating further. If someone could help with Texas attorney recommendations (real estate / private lending / collections) who can draft or review a repayment agreement. I would appreciate any insight or referrals from those who’ve dealt with similar situations. Thanks in advance!

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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
10mo
Quote from @Fernando Roman Romero:

I did not receive a recorded deed of trust but I did get a written promissory note. I will shoot you an email to discuss it more there. Thank you!!


 without the recorded deed you have an unsecured note, did you not use a title company to close this? Do you even know how many other loans they have. We use Macke Wolf in texas and the first thing as part of any arrangement would be to make sure you get it secured against the property. that is priority #1. 

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  • Mitch Messer
    Lender · Playa del Carmen, México · Member since 2014 · 2k+ posts · 1k+ votes
    10mo
    Quote from @Fernando Roman Romero:

    I made a private loan of approx. $40,000 to a friend and his partner through their LLC for a Texas fix-and-flip project. The property did not sell due to market conditions, and the repayment date has passed with no repayment.

    I’m trying to handle this professionally and would prefer to formalize a repayment plan before escalating further. If someone could help with Texas attorney recommendations (real estate / private lending / collections) who can draft or review a repayment agreement. I would appreciate any insight or referrals from those who’ve dealt with similar situations. Thanks in advance!


    Fernando, did you receive a recorded deed of trust and a signed written promissory note when you made this loan?

    If not, I fear your recourse options are going to be very limited.

    However, if you've got a secured lien interest, I've got a great Texas attorney to recommend. (We're currently going through a similar situation in Beaumont.)

    You can hit me up directly for a warm introduction. My email is in my BP profile. I don't DM here.

    1Reply
  • Fernando Roman Romero
    OP
    Rental Property Investor · Lubbock Texas · Member since 2018 · 12 posts · 4 votes
    10mo

    I did not receive a recorded deed of trust but I did get a written promissory note. I will shoot you an email to discuss it more there. Thank you!!

    0Reply
    • Chris SeveneyBusiness Member
      Moderator
      Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
      10mo
      Quote from @Fernando Roman Romero:

      I did not receive a recorded deed of trust but I did get a written promissory note. I will shoot you an email to discuss it more there. Thank you!!


       without the recorded deed you have an unsecured note, did you not use a title company to close this? Do you even know how many other loans they have. We use Macke Wolf in texas and the first thing as part of any arrangement would be to make sure you get it secured against the property. that is priority #1. 

      7e investments53 Reviews
      WebsiteView Page
      2Reply
  • Jason MalabuteBusiness Member
    Accountant · Los Angeles, CA · Member since 2016 · 2k+ posts · 914 votes
    9mo

    You may get better and more relevant responses by posting this in a local Texas real estate or Legal & Legislation forum—especially one focused on Texas law. Since this is primarily a legal and collections issue rather than a tax issue, posting in a tax-focused forum is unlikely to generate the best answers or referrals.

    Malabute & Company CPAs527 Reviews
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