Is this appropriate and legal?

[Luke Diem]

Is this an appropriate and legal way to ask friends and family to help find private money investor partners? This is a message I would send to a group of my very close friends.. any advice or tips would help, thanks!!! "Hey as you guys know I'm looking for private money lenders. I would offer an expected 8- 12% interest rate which would mean if they invested $100,000 they would earn $8000-$12,000 annually (there are very few returns like that out there). And sure this comes with a risk right? The lender would be secured with a lien on the property. Now maybe none of you guys know anybody interested. But if you do I will offer a 1% referral bonus to you. if you find a lender for $100,000 I will write you a check for $1000. Just keep this in mind and talk to people, you never know… also keep in mind everything will be done legitimately through a real estate attorney with contracts."

[John Thedford]

I would talk to people rather than email them. It is much more personal. Also, I would offer some information as to experience, etc and what YOU will put into the deal. When you ask others for money, if you aren't putting in any of yours, they will be more skeptical. If you tell them you will put up 30% of your funds, that shows you have faith in your ability to make the venture a success. If you are asking them to put up 100%, they would question why you don't believe enough in the project to put your money at risk. I say this not only as a HML, but from personal experience with people over the years.