All Forum Posts by: Jeff Wills

I would say to get started, you need to have roughly the amount of your Average median home price in your area, but should only ever loan to 70% LTV. This will ensure you avoid all but the absolute worst downturn in an area. If the market drops 30% overall, we have much bigger problems most likley. I have been learning from the group in my office for over 10 years now, and they have been in business for 12+.

Take your time, start small, and be diligent in picking the right first few deals. Once you have a proven system, raising capital should be fairly easy to get others on board. Only do Asset based lending with ownership in an LLC, this will help you avoid any homestead laws that will drag out a potential foreclosure. When you foreclose on an LLC, the courts and system have far less sympathy than a owner occupied.

My funding partner has amassed over $100M in AUM currently and growing, with an average LTV around 55% and with over 800 loans fewer than 10 have defaulted to my knowledge, and even then the investor made out handsomely due to low LTV and default interest rates. YTD they have paid out over $2M to their investors while closing about $20M in loans.

Being reliable is the biggest asset you can have, never accept a deal unless you are sure you can fund it. Over time, you will have people beating down your door.