All Forum Posts by: Lupe Santiago

Hi - I have a question for some experts regarding hard money lending. I make private hard money loans for real estate investments, and under Nevada law, I am exempt because they are for commercial, non owner occupied purposes and I use my own funds.

Recently a guy called me and wanted to provide "connection services" by putting me in contact with certain real estate investors looking for loans. He claims he's not a mortgage broker, but he wants a cut of the points as compensation for connecting the money and the borrower.

Could I get in trouble for paying him a fee in connection with my loan? I don't think he's a licensed mortgage broker.

Thanks and let me know if I need to provide more information to be helpful.

Hi - I'm just starting out in the business of lending. I'd appreciate your input on where professionals like yourselves go to find sources for financing. I am not a broker and do not use brokers because of my business model. If it helps, my location is Las Vegas, NV. Any input is welcome!

Thank you very much!

Jon Holdman - Thanks for your input! This is all very solid advice. Yes, I am in Vegas a lot and I will actually be living there and commuting between LA and LV for my work. I've done a number of private lending transactions before, but always through a broker. This time, there was no broker involved so I wanted to make sure I didn't have to be licensed to do this sort of a transaction.

I think I'm in the clear after reading Bill Gulley's response and I checked out Nevada Revised Statutes (specifically, NRS 645B.015-.016 provide the list of exemptions and I would fall under the exemption).

Any opinions on how many of these you can do before you need to be licensed? Can I hypothetically do 100 of these transactions if I never use a broker? Are my advertising capabilities limited as a private lender?

Thanks!

Bill Gulley Hey great advice! I'll give the NRED a call and that's a nifty idea about selling the interest back at closing. Sounds like it's just a matter of form over substance, but hey, if it works, it works. Thanks.

Ann Bellamy Thank you very much for the info - that's exactly what I was looking for!

How could I forget that piece of info! Thanks for reminding me, Ned.

This is for an investment property. He is a flipper and this will not be used for personal, family, or residential use.

Hello - I was looking through Craigslist and came across a Borrower who needed to borrow about 2/3rd the purchase price for a property, which is in Las Vegas, Nevada. I like the property and the loan to value... the question I have is fairly simple:

Can I fund this loan as a non-licensed, private individual? There's no brokers involved or anything like that. Just two people trying to make a deal work. I've bought a few trust deeds this year in California, but that's it.

Thanks for your responses!

Hi everyone, thank you for the replies! I can see how my misuse of the terminology confused everyone. I am indeed the lender, but will also be the broker to these loans in the near future. My sister is the broker I put on paper and she communicated with the Borrower, but she hasn't really been active in the last few years... I sourced the loan and went through her so I could avoid usury. I have resolved the situation and the loan has closed.

Hello! Kind of a simple question here so maybe someone can help me answer it. If a broker brings me a loan for an interest-only, short-term note that balloons, which forms does that broker need to provide to me, the originator?

It seems to me that the broker needs to provide a form DRE 851A (Lender/Purchaser Disclosure Statement for Loan Origination)

and also a form DRE 885 (Mortgage Loan Disclosure Statement/Good Faith Estimate, Nontraditional Mortgage product)

Is this correct? Thanks!

Hi, I'm in the process of obtaining my CA Broker's License to start my hard money lending business, but I have not yet gotten it. I have a contact in CA and he is a flipper (with his own LLC) that needs money to finance a property that he will soon be in contract for. This is going to be a traditional hard money loan:

I'm using my own capital from my own bank accounts - no brokering involved.
The interest rate will be above 10% on an interest only loan.
I have not made any other loans this year.
It will NOT be for personal, family, household, or residence use. It is purely commercial and business purpose.
This will be a loan secured by first deed of trust.

Can I make this loan as an individual w/o a broker's license? I am not considered to be in the business of making loans - I have a different job. Can I charge points or loan service fees or can I only receive interest as compensation?

Thanks in advance for the answers!