Best way to start relationship with hard money lender
Hey you all,
I’ve come to the conclusion that getting a hard money lender will be my best bet first my first property and probably future investments as well. I have just a few questions for you guys if you don’t mind chiming in and helping me out.
- How to avoid scammers
- Best way to build a relationship and create a deal with a lender(how to find, keep, and have an ongoing business relationship)
- Is the first deal usually 20% down or can I avoid that?
- Should I get a proof of concept on my own before going after a hard money lender?
Anything you guys could chime in with would be a huge help whether it pertains to these few questions or something else to do with hard money lenders.
Thanks!
Most Popular Reply
I have not had any luck finding a hard money lender. Of course I have been looking at little money, not large sums. Friends, family and acquaintances know my character, what I do and how I go about it. Larger amounts, I go to one of 3 banks and see what I can do.
Individuals, know that things come up and I can usually explain why their payoff may be a day, month or even several months later. They have never had a problem and I always compensated them for their understanding.
Whoever you deal with you have to make whole and the more they accommodate you the more you should show your appreciation. I had one that went over 6 months over on a flip. The lender, a family friend, still got his 8% interest for the entire period but I also gave him 5% of the profit, which took him to almost a 25% on his money in 15 months. When I apologized for it being longer than we expected, he said any time I was giving him over 20% an apology wasn't necessary. Guess what he is on the next flip. Just treat people right, I prefer to do business with my local area of influence.
Individuals, know that things come up and I can usually explain why their payoff may be a day, month or even several months later. They have never had a problem and I always compensated them for their understanding.
Whoever you deal with you have to make whole and the more they accommodate you the more you should show your appreciation. I had one that went over 6 months over on a flip. The lender, a family friend, still got his 8% interest for the entire period but I also gave him 5% of the profit, which took him to almost a 25% on his money in 15 months. When I apologized for it being longer than we expected, he said any time I was giving him over 20% an apology wasn't necessary. Guess what he is on the next flip. Just treat people right, I prefer to do business with my local area of influence.