Do you typically give a profit split to your PML?

[Clarence Browne]

Everywhere I read about PML, the "TYPICAL" deal is described as 8-12% interest (I've seen 6-15% as well) with nothing being mentioned about a profit split.  I do see instances where joint ventures may be up to 50/50 profit split but this is always discussed as expensive and out of the norm terms that you want to get away from as quickly as possible.  Is there typically a profit split with private money lenders?  I want to be fair with my lenders, but I also want to be clear on whether or not I'm paying more or less than the norm.

[David de Luna]

With HML, a split is never part of the discussion. HML wants only guaranteed money and it's typically origination fees (points) and some junk fees for some, plus the percentages you mention. You might be confusing HML with PML. PML (a "private" party - your uncle, mom, grandma, friend) terms can be WHATEVER you negotiate - whatever makes each party satisfied, interest amortized, simple, split, no split, whatever gets the deal done. With PML the two parties make up their own terms. HML is much more rigid and structured, and often an actual company with employees like Lima 1, Patch of Land, etc.