All Forum Posts by: Zach Morton

I understand the importance of having an attorney who is local so they are up to date on geography-specific laws and regulations, but what about a CPA? I noticed BP has a list of trusted CPA's but they seem to operate nationally instead of locally, would this equate to less specified advice?

On a separate note, what is the best way to go about finding a CPA and an Attorney in a market that I plan to move to soon? The market is Phoenix AZ.

@Petronella Kerssens

Have you thought about being a private lender / LP in some deals instead?

@Anthony Freeman

I break up my business into a few steps that together serve as my process to vet borrowers and loan out money. I showed you the screening step above, from there what I would do is called my "Application" step - this is where I have the borrower fill information on a loan application. You can ask for many things; full legal name, entity name, income and employment verification or business P/L acknowledged by attorney, bank statements to verify cash on hand, addresses of previous projects they've done and the purchase price / sale price / rehab plan of that deal (specifically want to see experience in the same type of deal that they're looking to borrow money from me for; fix and flip), information about the deal they are asking to borrow money for now (address, purchase price, projected ARV, rehab plan and budget). There are so many different bits of information you can / should collect to properly underwrite the loan and make sure the deal that the borrower would like to pursue is actually sound and also make sure the borrower themselves is financially sound (good credit score, personal collateral, etc). I highly recommend reading Lend to Live by Alexandria Breshears and Beth Pinkley Johnson, it was my guidebook when I started. It will answer the questions you are asking and outline the process in detail.

Hi @Doug Smith - thank you for the website! I just PM'd you

 I'm definitely going to check this out! Thank you.

 Hi Anthony, I have! I also have a process in place for collecting documents, underwriting, etc. 

My screening process: 

1. First Impression
• Do they show up on time? If they’re late it’s an indication of poor time management.
• How do they present themselves; clothes, hair, posture, body language
• Do they ramble and talk too much? If so they don’t listen well and will be a pain to deal with.
• Are they a smooth talker / salesman? Look out for social manipulation.
• Are they know-it-all or arrogant? Don’t work with people who try to make you feel small to showcase their strengths and talents.
• What is their Uber/Lyft rating? How they treat those who are in service of them provides a glimpse of their character.
• Traits you want to look for: honesty, integrity, character, good communication skills, project organization and articulation, personal accountability, focuses on solutions and financial acumen.
• Do you like being around them, do you trust them, do you want to do business with them, is this someone you would trust to communicate and work through things when your money is on the line, what does your gut tell you
2. Experience
• Ask about their experience in real estate, specifically in regards to the deal type they are bringing to you. Look for someone with a long track record and a good reputation, and be sure they’re well connected in the local market.
• What are their goals? Are they serious about being massively successful in RE or could they leave it all behind.
• Ask them to share their worst deal, what went wrong, what happened, then shut up and listen. Do they blame external circumstances as the sole cause or do they take responsibility and communicate the lessons they learned? You can ask them what they learned from the deal, you can also press and ask what they could have done differently. Another thing to listen for is that all deals have been nothing but smooth, this means they’re likely covering something up.
3. The Deal
• Ask about the current project - basic criteria only to ensure it’s possible to work it, also allows you to let them know what they will need to do in order to fill out the application (such as getting purchase contract signed by both parties)
• Location & primary residence
• Property type & deal type
• Have they seen the property in person? Do they have photos they can show you? How did they find it?
• Is the property under contract, purchase contract signed by both parties
• Purchase price + rehab plan / costs + ARV, potential profit / expected returns
• Why do they think it’s a good opportunity?
• What potential pitfalls do they see?

You really want to get a feel for this person, if you like them, if you'd trust them to remain accountable if the deal goes south -- be super picky and make sure they have both experience and internal qualities that you want in a "partner".

Hi everyone, what are the usury limits for a private money lender in the state of Arizona? I read it was 10% in a few different places but that can't be right, that is so low. I also noticed you have to be licensed to be a private money lender in Arizona, what kind of license does this require and what's the best organization to go through?