All Forum Posts by: Darren Eady

Contact me directly through BP and I'll assist with the financing.  Thanks!

If you have a custodian for your SDIRA or SD401k, they should have some recommended non-recourse lenders for you try.  Realize that if your loan is a short term loan, you'll need to contribute enough $ to your account to pay off the loan completely before the end of the loan term as you will not be able to refinance this loan at a bank that offer only recourse loans.

I don't have any experience with this lender you mentioned, but lots of experience lending.  Exactly what type of insurance is he requiring?  What is loan insurance?  How much is the fee?  Send some details back and I'd be happy to tell you if the cost is fishy or not.  BTW: most lenders do NOT have upfront fees other than for valuation on the property (typically)

25% down will still get you a better conventional interest rate.  Great credit will help the level of approval you receive.  Additional assets in reserve are another thing a bank looks at on an investment property.  Typically you'll want three to six month's monthly payment in your bank in reserve (per property) to show the bank.  Good luck!

You can record a Notice of Interest against the property.  This will show any title company involved in the closing that you have interest in the property and they will call you for a pay-off.

Brian, I've been lending private money for nearly 20 years. You're setting yourself up for failure with your current structure with no recourse to recoup your investment. You need to secure your investment with either a notice of interest filed against the property (at minimum), to even get repaid, or a 2nd mortgage, or a joint venture with the first private lender and a new LLC to lend to the borrower in 1st position. Also, not having a payment each month sets a bad precedence for getting repaid. Make the payments start 30 days from the day you lend money at 12% interest rate, or higher, and make the penalties stiff if they do not pay on time, or early. I've "given" too much money away to know that even a deal that "sounds" good will turn ugly without the correct documentation and leverage.

 The notes I purchase are three year notes at 12% minimum return, so inflation doesn't really play much of a part in that.

Ali, some of my rentals are much like your hassle free rentals, but some are not.  Be glad you've found a great situation for your investment properties!

Let everyone know if your deal actually works out.  I've had bank after bank present terms that they end up not being able to deliver for one reason or another.  If those terms are for real, please send the BP community the good news and the loan officer name, area and phone number!

I got involved in mortgage notes through private lending. I came up with a program in 2010 to write low LTV loans with a 12% interest rate and then sell the mortgage note to a passive investor rather than holding the paper with the company I wrote the loan through. This company grew and grew and has loaned and sold over $200 million in small loans / mortgage notes over the last five years.

I immediately started buying these notes and holding them with my own funds and receiving monthly direct deposits from the servicing center I connected with that collects from all of our borrowers and pays all of the note holders, myself included.

My rental properties haven't produced a 12% annual return and my bank surely doesn't care to try to, so these mortgage notes have grown for me to provide much of my monthly income now.  I have access to them whenever they are available. 

For years I only purchased rental properties. I own many now. Some are good and some are not so great. The last two years are the first two years in twenty that I made money overall on my rentals. I'm hoping the headaches will pay off at retirement?

Over the last five years, I started buying mortgage notes instead of rental properties. I've enjoyed this type of investing more than owning properties. I've realized that even though I'm elbows deep in real estate every day with my lending business, as an investor, I would rather buy passive real estate investments and not deal with the tenants, toilets or trouble.

I'm wondering how many people are like me? Which type of investing do you prefer and why? I would love to hear from people that own properties and mortgage notes to see which they prefer and why.