All Forum Posts by: Julian Buick

@Jay Hinrichs I see you're in Charleston and Orlando. Ever considered Savannah? I just moved here a couple of months ago from Seattle and see lots of potential here for rehabs in the historic area and infill projects. Lots of vacant lots for some reason. I'm trying to network as much as possible down here to find the serious players. I see lots of remodeled homes in areas that are gentrifying. I'd love to find an opportunity to put some funds to use. 

@Jillian Sidoti was that a loan to an owner occupant? I.e. If it's a loan to an investor is a Form D required?

Thanks @Jillian Sidoti I guess I better figure out what a Form D is then...

@Jillian Sidoti I'm not sure what you mean by "Washington State is a horrible state that goes through clerk records to find non traditional lenders and then tracks down a borrower to hit the borrower with a fine". Could you elaborate?

@Jeff S. for second position rehab loans why do you need to work with a licensed broker to originate the notes? Is that a California thing?

@Jeremy K. I started out by networking. Hard money lenders base the majority of their loans on a 20% annualized interest rate. I.e 4 points and 12% interest for a 6 month loan equals 20% annualized. If it goes over 6 months the extension fee is about 2 points for an additional 3 months, again 20% annualized. They are almost always in 1st position. I found my niche by lending in 2nd position for  the rehab funds at 20% annualized interest. For rehabbers it works out cheaper than splitting the profits. For me I get a good return without any work. I only work with people I know and that comes from networking. People with a strong reputation and no first timers. It takes time to build up a network but it is a fun process. I am always going out meeting people for lunch to discuss future projects. After two or three meeting with a person you can get a good feeling about whether this is someone you want to work with or not. I enjoy the process and it's always nice to make some money on the side. 

@Jeremy K. you have the absolute right idea of borrowing money at a low interest rate and using it to invest at a higher interest rate to make money on the spread. Most people on here can only see making money by buying rental properties and do not see the benefit to making money on arbitrage. I took out a heloc on my primary residence, the base interest rate is like 5% but if I call them up I can get an advance for 12 months at about 2%. I use that money to make loans to rehabbers at ~20% annualized. It takes a bit of time to figure out who the right people to lend to are but not that long, you would be surprised. The real estate world is pretty small so the word gets around who the good guys are and who the not so good guys are. After a while you are presented with more opportunities than you have funds for. It's not that hard, as long as you have a bit of common sense. Good luck and don't let the naysayers dissuade you from what is a good strategy.   

@Matthew Murphy I'm not at the point where I need one yet. I just wanted to open an account at a bank that does portfolio loans so that by the time I need one I will be able to tell them I have been a valued client since 2015 or whatever. Banks seem to like that kind of thing. I opened an account at Washington Federal based on the recommendations above. 

@George Despotopoulos aha, now I get it. Lima One, B2R, Lending One, etc. are not private lenders and referring to them as such only confuses people. The OP was requesting info on what rate and terms private lenders charge. Your response is more aligned with what those companies charge and not private individuals. Private individuals rates and terms can be all over the map. That was my point.

@George Despotopoulos I said hard money lenders use the term "private lender" to sound more appealing, when they are not actually private lenders, they are hard money lenders. You seem to think there are two different types of lending companies; hard money lenders and private money lenders. As stated previously, private lenders are not companies, they are individuals that lend their own money. I saw that you stated in another thread that private lenders have seasoning requirements for lending on refi's and they are not as strict as a hard money lender's seasoning requirements. Where a HML might have 2 years, a private lender will only require 6 months or something. You just made that up. Private lenders can and will have their own underwriting requirements based on the sophistication of the individual. There is no rule that says private lenders rates will be somewhere between conventional and hard money. You just made that up too. A private lender can make a loan at 0% interest if they want to, and they do all the time. Mostly for a family member or close friend, to help them out of a bad situation. On the other end of the spectrum they can charge 24% or higher interest, it's definitely not uncommon. I'm guessing that the rates that you are throwing out there for these "private lending companies" are actually the rates that your company, a hard money lending company, charges and refers to it as a private money loan. Either way, it seems like you are trying to promote your services, which is fine, I see people do it on the forums all the time. It's just not really allowed is all.