Real Estate Investor · La Jolla, CA · Member since 2010 · 16 posts · 1 vote
Does anyone use a mortgage broker they'd recommend, when loaning out their own funds for short term/transactional loans?
What fee or percentage is customary for the m.broker who handles the marketing to locate borrowers and brokers the transaction, and processes the paperwork?
Lender · Los Angeles, CA · Member since 2009 · 1k+ posts · 2k+ votes
16y
Originally posted by CommercialReit:
... when loaning out their own funds for short term/transactional loans...
The magic word you used are “their own funds†and “short term/transactional.â€
If you are doing short term/transactional loans, I can’t imagine that these are anything other than to investors with no interest in occupying the premises (i.e. flippers). Thus, these are business loans and do not require a broker. There is also no limit on the number of deals you can do.
As long as you are loaning your own money, you don’t have to worry about security laws. That is, loan away.
You do not want a broker to locate and market for you. You want to locate yourself and form relations with (hopefully experienced) borrowers. A broker will only get in the way and perhaps put you in dangerous deals you have no understanding of or control over.
Real Estate Investor · Canyon country, CA · Member since 2010 · 22 posts · 4 votes
16y
Regarding fees. You as the lender do not pay any fees, if that is what you were asking. The borrower does. You need a broker to prevent you from violating usury laws.
Investor · Round Rock, TX · Member since 2010 · 8k+ posts · 4k+ votes
16y
I would think the fee is pretty much the same as one would expect for someone brokering traditional loans...possibly a bit higher....and yeah...it should be passed on to the buyer/borrower.
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
16y
A better way to ask this question is what do you as the lender receive vs. what does the borrower pay. Using a broker for this sort of lending is really a matter of you and the broker splitting the total amount paid by the borrower between you and the broker.
Lender · Los Angeles, CA · Member since 2009 · 1k+ posts · 2k+ votes
16y
Originally posted by CommercialReit:
... when loaning out their own funds for short term/transactional loans...
The magic word you used are “their own funds†and “short term/transactional.â€
If you are doing short term/transactional loans, I can’t imagine that these are anything other than to investors with no interest in occupying the premises (i.e. flippers). Thus, these are business loans and do not require a broker. There is also no limit on the number of deals you can do.
As long as you are loaning your own money, you don’t have to worry about security laws. That is, loan away.
You do not want a broker to locate and market for you. You want to locate yourself and form relations with (hopefully experienced) borrowers. A broker will only get in the way and perhaps put you in dangerous deals you have no understanding of or control over.
Investor · Chattanooga, TN · Member since 2009 · 1k+ posts · 903 votes
16y
Having done transactional funding with my SD IRA, I don't use a broker at all. My business comes to me from word of mouth (I don't advertise at all) and I will pay a referral fee (couple hundred) for the referral.