Private Lending Mechanics

[Timothy Douglas]

When do private lenders actually get paid? Say I want to buy a house that's worth 45000 to buy and hold. I need a 9000 dollar down payment. Let's say I get that from a private lender. When would they actually get that money back? It wouldn't be for a while so why would they give me that money? I understand why they would carry the mortgage. Even then, would they give me the whole 45,000 cash? My last question is whether or not these private money websites that accrue investors that lend nationwide are worth my time?

[Michael Glist]

Private money will typically get paid either monthly or upon selling/refinancing depending on the strategy you take and what your agreement is with them. So if you are looking to get a private loan to help you purchase a flip then they would likely get paid when you sell that property. If you are looking to get money to purchase a rental then they would likely set up a monthly payment kinda like having a second mortgage or HELOC. The best person to talk to about actual terms and repayment would be a private lender as they are all different and may have different rates and terms based on the plan and the property itself.