And if you are saying a 12 cap do you mean you wrote the note at 12% interest or are you saying your discounted return is 12% interest because you paid say 50k for property and took a note back at 60k at 8% but making return on greater principal.Lots of newbies on this site and a full explanation would be wonderful for them as this is a good exit if you get tired of land lording especially out of state folks.Did you actually do a Mortgage and Note and record same.. so the new owner is paying tax's insurance and all other normal costs.. or did you do a type of unrecorded contract for deed type of transaction? 

I appreciate your explanation. 

If you haven't already, set up your Keyword Alerts so you'll be notified when topics and geographical areas of interest are being discussed.Read the Ultimate Beginner's Guide as well.And I could probably go on for days with some of my favorite links but you'll find the posts and topics that fit your personal goals in no time.

@Dev Horn  thanks for the more in-depth explanation, this is making even more sense now.  

Try leaving a business card or even a letter to see if you can get them to call you, maybe with a brief explanation of why you want to speak with them.But it couldn't hurt to either ask the contractor if they would forward your number to the owner or if he could just give you theirs.Never hurts to ask.

@Curt DavisThanks for stating the obvious (depending on one's perception of reality) in that theft is not geographically restrictive.

I don't think your proposal would stand the test if IRS or DOL comes knocking on your door and you guys have to provide an explanation.

I need a concise explanation on the effect of signing a Technical Service Contract with Third Party under Special Purpose Vehicle.

This would more so be a partner situation so not lending to strictly a borrower.I would be funding the entire project which would come out to around $175k - $200k including purchase and repairs.I have never lent private money before and would appreciate some advice from some of you guys out there with experience in this area.Just want a quick explanation of the basic steps i should take in this process.Ex.1 Contracts/documentation to make sure is in place2 How to be prepared legally3 Best ways to make sure investment is protected4 Making sure no one can run away with the money.5 How ownership of property should be held6 Dos donts etcI have heard that securing your money with your name on the deed of trust isnt always good bc of certain risks.Any advice much appreciated.Thanks

Originally posted by Joffrey Long:Section 32 and 35 do impact owner-occupied loans and as you know, cause additional requirements and liabilities to kick in when you exceed certain interest rate limits, all FAR below the usury limitations.Joffery: Good explanation.