Skin In The Game
A very common term in real estate investing is 'skin in the game'. From a lending perspective it usually means how much cash a borrower is putting into a deal. Every company varies, but true private money will vary deal by deal. The reason being is because the loan is based on the asset and not the borrower. With that being the case, the lender has to determine a maximum amount of exposure they are comfortable with and work backwards. The stronger the deal, the lower the cash needed from the borrower. The weaker the deal, the more cash will be needed.
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