Private Money Lender Advice

[Corey Wogtech]

I've recently moved into a much more expensive market, and I am no longer able to compete by making all cash purchases. I am a small investor with limited business structure to date. All of my previous purchases have been small cash deals, so I am looking to educate myself on the financial side of borrowing deals. I would like to begin developing private money lending relationships. Any advice on this matter would be greatly appreciated.

Expected interest rates? Things to avoid? Ways to approach lenders? Ways not to approach lenders? Necessary paper work to prepare before hand? Etc..

Active links to BP threads already addressing this issue would also be extremely helpful.

Thanks in advance for all of your help.

[Joshua McGinnis]

I haven't done much with private money lenders, but I've spoken to several that advertise in my area. Without a track record, they tend to want a big down payment and have fairly aggressive terms.

I suspect, as with any business or finance relationship, if you have a proven track record, you can structure better deals.

As far as approaching private lenders, I would start by Googling. Many of the private lenders in my area have their own websites with contact info. Start by giving a few a call and asking them what their process looks like and how some of their more recent deals have been structured.