All Forum Posts by: Derek Dombeck

There are not to many sources for education on HML, but my friend Dyches Bodiford has a seminar once a year specific to this. I believe it is in March. It doesn't teach you how to market for clients as much as it does the technical/legal side of the business. Assets101.com is his site.

Finding borrowers is easy. It does require local networking or else you can target local Facebook investors groups. Personally, I think face to face is best as you get started. 

Feel free to call me if you need help.

Banks are 1 of many ways to accomplish your goals. You need to learn how to creatively structure deals. I stopped using banks after the 2007 crash and I have done 100s of deals since. Learn how to use options, subject to, leases, and exchanges to accomplish your goals. You can create a promissory note on your free and clear property and sell or exchange the note for cash. You could just pledge your existing properties as collateral to buy additional units. There are many more examples, but education is the key. Go to Cashflowdepot.com and listen to Peter Fortunato, Dyches Bodiford, David Tillney, Bill Cook, and Jack Miller. These are all my friends and mentors except for Jack who passed away years ago. You will see it's fairly easy if you take the right steps. Best of luck too you.

If you have lived in it as a primary residence for 2 of the last 5 years, you can sell it subject to tax code section 121. That code allows the sale to be capital gains tax free up to a limit.

My favorite source for all things in creative real estate is cashflowdepot.com 

This is a paid site,  but it is cheap. Many of the educators on there are personal friends of mine and they have taught me much of what I know over the years. I'm also happy to help if you want to reach out directly. 

Your 1st step should be to get educated in the type of investment you want to make. 

If you have a free and clear home, you could be renting it out, borrow against its equity, use it as collateral when leveraging a new purchase, exchange it for another property (tax free), live in it for 2 years and then sell it (tax free), etc. The possibilities are many, but education is the key.

Checkout cashflowdepot.com 

It's a great resource for all things in real estate that are creative. 

That would work if the seller doesn't mind an unsecured loan. It may affect your debt to income ratio for the bank loan.

A Hard Money Lender will typically not want to be in 2nd position to another lender. If you were approaching me to be the primary lender and told me that your skin in the game was borrowed from Lending Tree, I would not mind at all as long as the house and the LTV fell within my lending criteria.

Hard money lenders like me would not take a 2nd lein position behind the existing lender at any LTV. Finding a cash partner or someone who has a self directed IRA or Solo 401k who would like to get involved would be your best bet.

After you catch up the arrears, how much equity is in the deal to protect you and/or your money partners? 

There is not a 1 stop shop to learn the HML business. You can learn the technical paperwork side from my friend, Dyches Bodiford who does a seminar once a year. Assets101.com

But, he does not go into the day to day operations side very much. Like, marketing for clients, tracking projects, construction draws, the default process, foreclosing, etc. 

if you handle your business properly, you won't have many defaults, but you should never lend on a property you wouldn't want to own. I disagree with Greg Scott about riskier projects only because you make the rules in your lending criteria, which minimizes risk. For example, we may ask a borrower to pledge a 2nd property as additional collateral, or lend at a lower LTV if we aren't comfortable with them or the project. If they don't like your terms, they can go elsewhere.

Feel free to reach out to me directly if you'd like to talk. Contact info is in my signature line.

You can buy property subject to their current financing staying in place, or buy an Option to purchase the property and hold that option for a future purchase. Once you have that Option, you could sell the Option for cash or trade it to another investor. You can Lease property and sublease it to your tenants. This can be paired with an option as well. Buying with a Land Contract/ Contract for Deed is another strategy that works well or having the seller hold a note and collect payments from you works too.

These strategies have similarities with each other, but the paperwork and the way you CONTROL the deals are different.