So after going through many of these investor emails, how long does it take until I find an actual private equity investor. I am in the St. Louis area and it is funny how many scammers there are. I managed to find a few legit ones but for every 1 legit it seems there are 3 false ones. I save myself by asking them questions, references and google them. I am still looking for private equity investors but nothing that cannot be worked through.
Any other thoughts on how to keep myself from falling into their trap?
I would ask for them to explain their experience and knowledge to you. This is invaluable, especially when you locate numerous investors who want to work with you. It's easy for someone to hide behind a computer screen and claim to be who they're not, which is why this due diligence is vital to your investing success.
I'm thinking three because, it is my understanding that you have to have an existing relationship with the potential lender or "3 touches" or encounters with them. I am not an attorney but it is my understanding that you can't market a private lender opportunity without "knowing" your customer. By that I mean knowing that RE investing is suitable for them.
private investor by their nature will be finicky nervous etc.. this is why they usually only do business with fairly well known to them folks.
I understand why folks want to find them because they can be cheaper than hard money but look at your lost opportunity cost if your not closing deals because you are trying to find this needle in a haystack investor. Plus HML need to eat too.
Ask them how they get paid.
Ask how you will receive the money. (If "title co. Is nowhere in their response, run!)
Ask where they are originally from.
Ask for a POF.
Ask for a reference (very important!)
Ask if anything needs to be wired right now.
Ask if they have any fees.
If Western Union comes up in the conversation, RUN!
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