Josh I have talked about this many times.On the residential side all these scammers used to exist.Sell the loan off so they didn't care and closed up shop when it fell apart.Now that residential is under huge government regs they have all moved to the commercial side.All of these people advertising many are just helpless point and fee takers getting sucked up into the scam.Many of these so called lenders are not lenders at all but mills running due diligence fees,insurance fees,deposit fees etc. and then say they can't fund later on to deny the deal.I have found direct lenders are very hard to find and I find one of those for every 20 scammers.As a buyer you do not pay upfront fees except for appraisal,survey etc.You can talk to these scammers on the phone and can tell by what they say they are not a true lender.I do very heavy lifting to make sure my lenders are real and I am not dealing with a middle man to protect my clients buying properties through me.Any company claiming to be a lender that will fund anything is more of a conduit (middle man) taking fees.A reputable lender will display recent closings and details of the loan.They will have very detailed rate sheets along with terms and conditions of the program.Any points will only be paid at closing when they perform.Many of these lenders will be highly specialized in a particular asset class and not broad in scope.The interest rates from legit lenders will be very close in percentage rate and LTV's.The difference being in how much money they have to lend and what loan size they specialize in and recourse versus non-recourse etc.Many lenders can promise but very few can deliver on the rates promised and close it.

I run in the smaller park crowd so Conduit Loans and the like are not things I think about much.

When you do see it there are normally stiff pre-pays (conduit loans).There can be a reset of the interest rate at 5 years or something similar.When playing in the commercial market forget the assumptions that come from the residential segment.John Corey

Obviously an over-reaction now that the horse is out of the barn, but it is what it is.I'm not running a conduit operation like these big turn-key investment companies, that buy/rehab, then sell to end-buyers on a turn-key basis.

The local banks just sign up with wholesale lenders, or one or more of the big banks, and the local bank just acts as a conduit, immediately reselling the loans as they originate them.

WiringWe did one up here & any wiring above grade had to be run through conduit to meet code

They may all involve issues with the "due on sale clause" another thing to search for.They may also be seen as a financing conduit and subject to your State SAFE Act.

I'd sell to them, they can put their "clients" in there or if my buyer qualifies under their housing program they can turn my buyer into their client.I'd use a non-profit as a conduit, I can sell to them as a commercial deal on a note.

I have attended some Meetup re investor meetings that seem to be conduits for real estate agents to attract people.Are REI clubs that advertise the national stuff any better for locating investors?

Looks like what we need is an article/blog on how to structure an entity to act as a conduit for financing acquisitions and seeking investors without getting into SEC requirements!