All Forum Posts by: Taylor Johnson

Thank you all for your feedback. This has been really helpful and now know how to structure my private lending.

Last night I attended my local REI meeting and the topic was about private lending. This seminar was so helpful and got my wheels turning about prospective family and close family friends who could potentially be a private lender for flipping projects. Based on the speakers examples and recommendation, he said interest rates are between 6-8% (located in Metro Detroit Area) and I could have the option to pay monthly at a lower interest or pay a higher interest rate if I get paid when the lender gets paid, meaning after the property is sold.

I was too embarrassed to ask, but is the interest rate calculated monthly or based on the contract's deadline? Also, if I were to reach out to a family member what would those who've used private money recommend as a "realistic" timeline for a beginner? He mentioned 5 years or until property is sold. I was thinking 3 years, but I wouldn't want to scare them off if that's too long of a time for me to return their money.

Open to different thoughts and perspectives. Thanks!

I am a new investor as well, but one thing I've learned is to not overload yourself with information you're not a point to use. For instance, I was looking at books about 1031 exchanges and I haven't even brought a property yet! Lol silly I know, but I caught myself before spending my time reading something that's far above my investing point, and even understanding. Of course, it's great to be knowledgable of things like that, but when you're just starting I think it better to stay inquire information that you can readily practice and use.

Hi Traceye - though I haven't done any investing in Marquette, I have thought about it as I attended NMU for undergrad. If you don't want to go in Nagaunee or Ishpeming, have you considered rental property in Marquette? Or Houghton where Michigan Tech is.

I'm an agent and soon-to-be investor, you can purchase a home in Downtown Detroit, but most likely it won't be turnkey. Turnkey properties in the area start around $200k. Though as Michael said, you can move to good investment areas just 10-20 minutes outside of downtown like University District, Sherwood Forest, East English Village, etc. 

Hi BP'ers! I found under the Marketplace tab a few hard money lenders servicing MI. Does anyone have experience with these lenders personally or can recommend any they've used?

I'm currently reading "The Unofficial Guide to Real Estate Investing" by Martin Stone and Spencer Strauss. Another go to is of course "Rich Dad, Poor Dad" by Robert Kiyosaki. Great book to challenge the way you think about finances.

@Ishviyan D. very good to know, thank you for responding. For whatever reason I thought it was an either, or situation.

@Georgui Kasaev thank you for sharing your experience! It has helped, especially since I would potentially take on the same role as you in the partnership. I struggle with the idea of bringing something meaningful to the table when it's not money.

What deals have you partnered on? I would like to get into rentals, but idk how beneficial that would be for partnering.

Just for clarification, when you use the BRRRR method:

1. Investor A loans cash to buy the property and pays for updates/repairs. Investor B refinances the property with a bank to pay Investor A back initial amount & repairs plus agreed interest?

or

2.  Investor A loans cash to buy the property and Investor B is responsible for updates/repairs and refinances with a bank to pay Investor A  back initial amount plus agreed interest?