How can I protect my money as a private money lender?

[Donny Widjaja]

A guy from my REI group is looking to borrow some money for a few months to cover mortgage cost for a property that he flipped. I am thinking about reaching out to him and help him out and also build my network at the same time, but this my first time to lend out money to others.

Assuming we have agreed in our terms (agreed on the amount, length of loan, interest, and additional fees).  

What kind of paperwork do I need to file?

Do I need to file something with the title company?  So, it shows that my money is tied to a specific property.

Thanks,

Donny

[Jay Hinrichs]

@Donny Widjaja  since your being asked to just loan enough money to make payments on the existing first mortgage . you would simply be doing a unsecured Promissory note.

Although not tagged to a property there is no defense for non payment and a judgement is easily gotten ... caveat is that this person actually has some assets which sounds like he probably does not since he needs to borrow from you to make payments .

unsecured prom notes to a very qualified a borrower are fine.. 

second loans behind construction loans are not are not advisable in any scenario and can very well be a event of default on the first loan.

@Steve Bach  a phone call to your state banking commission to ask your questions 

BP is not the place to get this info its your butt on the line and BP is all hearsay when it comes to t to laws of the land