Private Money - when is it appropriate to actually get the money?

[Andrew Robbins]

Newbie here trying to make first deal happen.  I have friends and family interested in giving me money.  The question is what is the protocol in actually getting it from them -- from a timing standpoint, that is?  I obviously want the money in my account so I can show proof of funds if I want to pull the trigger on something.  But I may not find a deal worth doing until weeks or months from now.  Can I really ask them to pull their money out of a current investment and hand it over to me now?  But if I don't have money in hand to show the seller, how can I close a great deal immediately?  Catch-22.  Please help.

[Michael Hicks]

They (your friends and family) can issue you a proof of funds letter so that you can lock up the deal.  I don't ask for the money until I have the deal and usually don't take possession until day of closing.  I have seen some private lenders who wire the money directly to the closing company which is safer for the lender.  I have a security deed and a promissory note ready to hand my lender at the time I take possession of the check.  I have a relationship with my lenders and they don't have a problem giving me a cashier's check day of closing.  They have the promissory note and security deed.  Some choose to record it and others do not.  I'm sure this may not be the norm for "professional private money lenders" but it has worked with those I have dealt with.  Hope this gives you a few ideas.