Rental Property Investor · Bloomington, IN · Member since 2018 · 70 posts · 78 votes
My husband and I are looking to flip and/or BRRRR in Bloomington, Indiana and surrounding areas. We are exploring using private money and have had a few people contact me through BP but how do I know they are legit? I would ask for references from past deals but what other questions should I be asking and things I should be looking for? Any tips on the process of partnering with a private money lender, terms, etc? We are new to all of this and any help would be appreciated.
Realtor · WV · Member since 2018 · 454 posts · 310 votes
7y
I always like to start with finding out what their motivation is, what they are trying to accomplish and then you can figure out how to structure the deal to accomplish their goals. In my opinion this is always better than just throwing out what you assume would be appealing to them.
Other questions to ask
How long of a term would they like to lend on?
What interest rate do they charge?
Do they charge points? (this is more likely with hard money lenders, but some private money lenders will as well)
Realtor · WV · Member since 2018 · 454 posts · 310 votes
7y
I always like to start with finding out what their motivation is, what they are trying to accomplish and then you can figure out how to structure the deal to accomplish their goals. In my opinion this is always better than just throwing out what you assume would be appealing to them.
Other questions to ask
How long of a term would they like to lend on?
What interest rate do they charge?
Do they charge points? (this is more likely with hard money lenders, but some private money lenders will as well)
Rental Property Investor · Prairie Village, KS · Member since 2015 · 2k+ posts · 2k+ votes
7y
@Walter Aaron Poling
I agree. Setup a call and/or face to face meeting! If you understand what they are looking for you can structure something that works for them!
Investor · Indianapolis, IN · Member since 2016 · 232 posts · 133 votes
7y
@Brook Rieman I'm sure they'd want to vet you guys out as much as you'd want to vet them. Meeting them face to face and talking through a possible deal and discuss numbers would be the best. Also, have you attended any local meetups in btown? I attended a couple of them a year ago and I found great value. There were quite a few flippers and if you let them know what you're wanting to do, they might be open to partnering up on deals and maybe even show you the ropes. Good luck!