All Forum Posts by: Michael G.

Paying "All Cash" and you did the entire lawn and painted the outside of the house. Inside, you put in new floors and tore out the kitchen cabints along with installing a new toilet, vanity and sink all before COE. 

Good for you and it does not matter as far as the bank is concerned because you are paying Cash so not sure what that other guy was talking about. 

I sold a home to an investor and he said he wanted to remove the old porch and build a new porch before COE and I said, yes!nHe signed a waiver of liability and why not??? He also put down $40,000.00 with no inspection and that means the home is closing so he can add new doors, flooring and anything else he wants to do. Why not? 

Kevin Tillery

I am 30 days from relocating and getting licensed properly so I can do loans of all types rather than just commercial loans and I am currently working with Attorney Nema Daghbandan with the Geraci Law Firm, so I have put all lending on hold.  

It could be about 60 days or more until I will be ready to proceed with gentlemen like you Kevin but once I have my new license in hand, I would be happy to contact you to see what you may have in the pipeline. 

Being recognized as an above board and legitimate lender that can be trusted is earned and starts with being licensed properly.

Flippers with experience will be one of my target markets. You guys work hard and get good results. I started out as a flipper many years ago, so I have a lot of respect for you and men like you. 

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Nanc Nguyen you are correct about the primary owned properties if you mean they are residential in any way, regardless of the form (boat - only if it is their home, apartment, house they reside in, etc., they said. A person must have a license in that case every time.

UPDATE - Factual Info obtained from Oregon Licensing Division - I took the advise of Jay & Jeff and contacted the State of Oregon and they told me the following:

1. Anyone without any license can lend money on any commercial property or business deal in Oregon and charge 1 point or any amount of points that the 2 parties agree on which could be 2, 3, 4, or more.

2. The number of loans that a unlicensed person or private party can do in Oregon, can be unlimited. They can do 1 loan or 100 loans a year. - This surprised me also!

3. Usury laws in Oregon are non existing he said for commercial transactions. He said usury only applies to residential properties. I was surprised at that answer.

4. If you want to do 5 or more residential units at the same time, no license needed but if you want to do 1 to 4 residential units, you must have a license in the state of Oregon.

I wanted to get this info out to everyone that ever has a question in the future and the number I called can not be given out on this site I believe but I will gladly give it to anyone that needs it and the name of the man I spoke to.

Note: This information is not made up or my opinion, it came directly from Oregon State/Licensing Division!

This info may be challenged and maybe there is more particulars but I was on the phone with Oregon for some time and I was very clear so that when I posted this message, it would be factual. I even called Oregon back to make sure of what I was told the first time concerning all points listed above.

Michael Gardner

Thanks Jay.

I am just staying briefly in Oregon after recently getting married. I reside in Washington and when I made that loan, it was in Washington. 

I read your entire profile and many of your posts. You are experienced and know what you are doing for sure. I appreciate the heads up. I was never looking to be a lender, it just fell in my lap and now I am looking to do more of it. It is hard to get answers that help. You give them but many people have spoken to me on the back end and they say contact an attorney. I agree with that but I was amazed at how many attorney's do not know the answers either. You were right about making sure a person contacts the correct attorney. I had contacted 4 attorneys before doing my first loan and had one attorney draw up the contract that I will now have your attorney look at. I think the contract is fine what what I could see. 

I looked at other posts on the site and when people ask what is needed to loan people money, no one had the answer.

2 questions they asked were:

1. a license is needed

2. If they could charge points

Not one single person could give them an answer. What I have gather so far is if you maintain the usury laws and in Washington it is 12% anyone can loan another person money. As far as points, I have 4 people saying you can and they do it themselves and they are not licensed and 1 person saying it is illegal because if a person charges points, that makes them a lender. 

I can tell from our conversations on line, on the back end and from reading your posts where you help other people with questions that you not only know what you are talking about but you really are trying to help people.

I am contacting your attorney that you gave me. I think lending money is a great and safe way to go as long as a person understands the value of a property and does his homework with the client. I would however like to pay you to come and sit down and have a 2 hour talk. I could bring my wife and we could go have dinner on us. Give it some thought. 

I will be in Oregon until June 4th, I hope you can squeeze me in, I would greatly appreciate it.

Michael Gardner

That is a sweetheart deal! 

Make sure they know what they are doing. Joint Venture all the way. Interest only & profits, plus your entire loan paid back and another 10%. Tax on the payback of the loan in 2 years is the only drawback but the 10% at the end will soften the taxes you will pay.

Make sure they have skin in the came also. 

I am a lender now but I did this when I started many years ago. I am attaching a link which will spell it out better than I can explain it. Pictures are good also. 

https://investfourmore.com/brrr-method/

The general idea is to have money or get a loan and buy a fixer-upper. Fix it up, rent it out and go to the bank immediately where you can show the bank that you have the property leased out for the next 12 months and the bank will give you more money fixed up and rented rather than vacant (Refinance). 

You then pay off the 1st loan with the money you get when you sell the property and the excess money you have left over, if you bought the property right and fixed it fairly nice should bring you in $20,000.00 to $60,000.00 (depending on the property) on up and now you repeat that process over and over until you no longer need to borrow money, because you are getting paid monthly for the rent and on each purchase, you will make extra money.

It will take time but the tax benefits are great and with each property you buy, you get stronger as does your buying and loan ability. Lenders will see you as a "Good Risk" which in turn will get you better lending rates!

Have fun.

Michael Gardner

Hello Jay Hinrichs,

Thanks. That was a good and honest answer that I really needed. Good man. 

So now that you know the property is commercial and located in Oregon where you are from, how do things look now? Maximum amount of interest I can charge is what for Oregon? Also the entity was a Corporation that I lent the money too. What about points in Oregon. Are points state specific? Is there anything that is federally mandated because someone sent me a message away from the post about federal regulations trump state?

Jeff and Jay, you were both helpful.

Thanks but not really an answer in that statement, BP. The property involved is a commercial property so Dodd-Frank  does not apply. I will NEVER deal with residential properties like you DO BP, so I do not need a "Mortgage Originator License". Plus the buyer is not a "Natural Person" but rather a Corporation so I believe I do not need a license and I have not violated any laws is what I was hoping for. 

I went online and did some fact finding but John did help me about the points which I appreciate. 

I now just got some good advice from Jeff S. and I will follow your advice and contact a specialized attorney in this field. Little money might not have been the right words but I understand what you guys mean. Jeff, it was a commercial property and located in Oregon.