Where Do I Find Investors to Offer 6% Secured by 1st Mtg

[James Gallagher]

Hi All,

I just got some great advice by a fellow Bigger Pockets and RE leader. Why divest out of good cashflow property- owned outright when I can create a win-win with another investor? I got it!  

So now it is just a matter of learning a little more again and hence my question. Who knows where I can find hands free investors who would like 6+% returns on their money secured by 1st mtgs with 100% capital returned in 3 or 5 years?  

We are talking about ~$40k loan/mtg on one 3/1 SFH and I also have another property offering a duplex coming in at $59K. Loans to be used for reinvestment into business. I look forward to your suggestions. Thanks

[Cory Binsfield]

It sounds like you own some free and clear properties. If this is correct, I would go to a local lender (no big back with a huge national presence) put on a suit and tie and show them how you would like to take 2 or 3 properties as collateral and use the proceeds to buy, fix and rent over the long term. You would want a slick presentation that shows all your financials. Or use the BP calculator to show your buy and hold cash flow along with dent service, etc. 

Once you stabilize the new rental, you would then go back and pay off the original money with a 20 year commercial loan. On both cares, you should be able to get an interest rate of 5.75% or less. 

While you are doing this to get more deals, you could be working on private investors on the side. Honestly, if you came to me and said you would give me 6%, I wouldn't consider it worth the risk. This is why hard money lenders demand 10% or more plus points and short durations on loans.