Hard Money Lender Scams

[Alexis Monroe]

Hi there,

So, I am new to investing. In the past 6 weeks, I've been able to buy property from motivated sellers and sell it for a very large profit. AS a result, I applied for private funding with willie stevens with posh realty investors. I was able to be approved for $100,000 based on an executive summary, my drivers license, and copy of my utility bill. NO bank statements, or proof of my business financials were required. I got approved for 100k and he is offering me 5% interest rate. Pay back within 1 year. The paperwork looks legitimate. ITs 3 pages long that outlines the terms. It is going to cost me $3,900 which is an up-front loan processing fee.

Does this funding seem legitimate? I don't want to be scammed into someone getting me to wire them $3,900 to their bank account. What are other signs for private money scammers? 

[Jay Hinrichs]

Originally posted by @Alexis Monroe:

Thanks for the feedback. I requested proof of lenders license and he emailed immediately.  He also sent me his drivers license. I also verified his company is registered with state. Could it still be a scam with this documentation? What are realistic terms for private lenders? 

this is standard response by Scammers and crooks..  NO LENDER sends U his or her drivers license that's just BS.. anyone can register a company for 50 bucks again just to win you over and give an air to legitimacy.  Lenders license photo shopped or just not real.. 

Go to NMLS registry google it its easy put his name and company name in if he is state licensed he should be registered and for fun put my name in and see what happens.. 

NO ONE lends for 5% period.. and NO one charges up front money other than Do hard money and they couch it as buying their how to flip property manuals.. so they are selling you something. in exchange for the up front 3k which is mandatory to get a loan from them.. and then the rates are what they are.

standard rates for hard money is 2 and 10 for great borrower and experience to 5 and 15 for someone with little to no expirence and everything in between.. 

the next thing they will hit you with is insurance..  you pay this insurance in case you cant make payments.. that is also fraudulent there is NO insurance for private loans does not exist.. so they just try to suck as much money out of you as they can.. then either go dark or come up with excuses why your deal cant fund.. 

to to Lendinghome .com and look at what a real lender charges.