Why Newbies Should Take Another Look At Private Money

Private money can be intimidating to newbie investors.

First, it feels like asking a stranger for money. It brings up anxiety, doubt and vulnerability. Nobody likes to feel rejected. Because of that, less people may opt to ask for private money making it more readily available for those willing to go for it!

But, how does a newbie break that barrier? I had never looked at private money as an option until I started a new job and talked to a real estate agent. I told her I’m looking for a duplex or SFH that I can eventually rent.

I explained that I have nontraditional income that may not look too great on paper for a bank, yet I make up for that in other areas. For months, I’ve been researching ways to fix my “problem”—how to transition from renting to owning my first property without a bank loan.

So, I’ve come up with a few ways to help newbies—especially artists, creatives, freelancers and consultants who don’t have traditional income—build the courage to attract the private money they need. You may have heard that getting private money may be hard, but it doesn't have to be if you start working with what you've already got.

Increase Your Visibility

Whether networking on BP or having coffee with a local real estate agent, let others know you want to buy. This is not the kind of business to be shy.

Develop A Thick Skin

Learn how to take rejection. You will live. It is the biggest favor anyone can do for you! Read books by Debbie Ford. No one will ever be able to say anything you have not said to yourself. That way, it won't be a surprise. Your response, "Thank you."

Gain More Confidence

Get clear on how much you need and get all the details on the property you want to purchase. Any doubt on your part will seep through in your conversations, as much as being a fake. Develop a quiet confidence that will help you pull opportunities, instead of push your way to them.

From what I learned reading, The Book on Investing In Real Estate With No or Low Money Down by Brandon Turner, with enough networking and increasing your visibility, private money lenders should come to you. That will also take confidence on their part. I believe people have the same fears, evident or not. If you’re unsure about going the private money route, a private money lender may be just as unsure about you.