Private money lending

[Mike Wilkins]

Any private money lenders out there willing to provide some advice to a new investor?

Some questions I have are

1. What type of interest rate do you charge? Ex if you charge 10% do you expect to get 10% COC or annualized return? So if you lend 100k and get your money back in 3months do you still expect to get 10k back?

2. Insurance requirement? What type of insurance do you require the lendee to obtain? How much? Are there specific riders or things the must be put into the policy?

3. Do you get additional insurance for your self?

4. Type of loan you use? Ex. Open ended mortgage and Lein on the property.

5. What process do you use for rehab loan? How do you allow the lendee to make draws? Work request form? Do you just give free access to the funds?

6. How do you handle contractors? Do you require the lendee to withhold a percentage of payment from contractor until all work is complete? Do you require Lein release request? 1099?