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Updated about 2 years ago on . Most recent reply

User Stats

14
Posts
1
Votes
Tony Hill
  • Agent, Investor, and Builder
  • Colorado Springs, CO
1
Votes |
14
Posts

Being a Private Lender to Flippers - Real Numbers???

Tony Hill
  • Agent, Investor, and Builder
  • Colorado Springs, CO
Posted

I am considering the path of being a private money lender for fix and flip investors (I don't have the money to lend at this point, just doing the research).   

I am curious as to the reality of lending out short term loans to flippers (IE 10% for 4-6 month terms).  Assuming I take the proper legal precautions and lend to someone with a solid track record of flipping quick and profitably, this seems like a no brainer as it would return 20-30% annually.  

Am I missing something?  What are the real numbers I could potentially expect from doing this?  

Thank you!

Most Popular Reply

User Stats

537
Posts
228
Votes
Neil Aggarwal
  • Lender
  • Richardson, TX
228
Votes |
537
Posts
Neil Aggarwal
  • Lender
  • Richardson, TX
Replied

Its not 10% for 3-4 months.  Its 10% annualized rate.  So if the borrower pays you off in 6 months, they will have paid 5% in interest.

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