Investment Info:

Single-family residence fix & flip investment.

Purchase price: $169,000

Cash invested: $40,000

Sale price: $309,000

This home needed a quick cosmetic update inside a bit outs...

It's a very murky water between Private Money and Hard Money. 

My private money lender covered 100% of both the purchase and rehab costs—and even paid me $5K for my time.

If any lenders offer lower amounts, they likely still have a minimum origination fee or higher interest rate and are usually individual private lenders rather than institutional private money sources.

Seeking private lenders to fund How did you find this deal and how did you negotiate it?

Here’s the breakdown:Financing & Investment Details: Total Project Cost: $750,000 Purchase Price: $450,000 Rehab Cost: $300,000 Total Investment Needed: $750,000 Private Money Loan: $550,000 (1-year term at 9% interest) My Cash Investment: $200,000 Interest for Private Money Loan: $49,500 Closing Costs for Private Money Loan: $0 Closing Costs for Refinance: $27,000Total Cash in the deal:$750,000 + $49,500 + $27000 = $826,500Exit & Refinancing: ARV: $900,000 After renovation, I refinance at a new loan of ~$675,000.

In over 15 years of lending our money privately, here are the most common questions we are asked by potential borrowers.

I think you will benefit from a true private lender, as they don't require too much paperwork for draws and it can be as simple as submitting a form and taking pictures and receiving the draws in 24-48 hrs.  

Hiring the attorney to draft up the documents is the most expensive part, depending on the lenderCons:- Finding private lenders who aren't charging 10% or more is hard to do (Not impossible, just hard)Private lenders is my favorite, because we have found private investors who know us, like us, and trust us, so we are able to work with them and get rates just as good as banks provide, without much in closing costs, and flexibility to set up the loan how we want to set it up instead of Fannie and Freddie regulations.

It's generally fairly hard to convince someone to lend you a private loan if you have no experience investing.