Making an Offer with Private Lender Financing - South Florida - Palm Beach

[James G.]

I have several private lenders ready to provide capital for my flipping business. My question is regarding submitting an offer to purchase a listed on the MLS. Most sellers want either a proof of funds (cash in my account) or a preapproval/prequalification letter. As has been mentioned in several other posts, when using a private lender, they should give you a preapproval letter; however, one BP member indicated these letters aren't worth the paper on which they are written. Additionally, my private lenders are individuals that would not have any formal preapproval letter. Furthermore, my lenders are new to this process and I want to make it as easy as possible for them.

One post indicates using a personal LOC or POF for the offer, then closing with the private lender's capital. In this case, neither of these options is viable.

In listening to the BP Podcast, it sounds like a lot of investors use private lenders. So, I am curious of how BP members have successfully submitted offers using private lender capital? i.e. have you been successful with including a preapproval letter from a private lender, do you get the funding prior to making offers (a blind investment loan), etc.?

I have read through most of the private lending posts, but haven’t seen an detailed explanation for a successful offer process. Thank you!