Private Lenders Are They Out There!
Hey whats up everybody if you dont know me already I'm the guy with poor credit,no money, no even a job I invest full time ....well trying to invest I have a great chance to get a 9 unit building priced at 99k FVM is 170k 3 of the units are already rented which is good for me because just renting out three of them breaks me even only prob. is the owner is out of state and dont want the hassel anymore and he wants all of his money(reason for the discount)hard money lenders will not consider me because my credit is to low, and no asset...No Crap! dummys thats what I'm trying to do get some assets. I dont think the private lender thing works have anyone ever use one? How did you go about looking for them? and How much interest did you pay? (not that it matters) long as I have a positive cash flow right guys.....and girls!
I am in the process of a very concentrated effort to set up millions of dollars worth of private money. I'll post my strategies and information in an acticle in the upcoming future. Look for it in around 3 months!
Private lenders are for real!
GOOD LUCK
Maybe you can find a partner who has credit and assets. The numbers seem like there's enough 'pie' for two. That way you will at least make something from the deal, and almost as important, get some experience. What do you think?
I believe a distinction needs to be made between a private money lender and a hard money lender. Although both use private funds, true "hard money lender" loans money based on the merits of the property, not your credit. THey will analyze the deal and see if they believe it is good or not. They will not require to analyze your personal credit. They are more concerned with the deal because if for any reason you don't pay...They get the property and they can turn around and sell it themselves. Either way they make money. This is also why they typically only lend at 65%-70% LTV. That leaves enough room so they can add in a pfofit and still have the flexibility to flip to another investor.
If you have an individual acting as a private money lender, they a more likely to want to make a loan taking into account your personal credit.
In the 20-30 hard money lenders I've spoken to all of them had a min. credit score of 600 or above to get a loan. So I than asked the BIG QUESTION If my property has enough equity in it what does it matter about my credit? (same answer) of some kind they also would like some assets if I had assets I probably would not need "Hard Money" I would go conventional and get a better interest rate so no matter what anyone loaning money wants money from you which is ironic! and want collateroll which is also ironic because my building should be enough collateroll[ Edited by steadydoses on Date 03/14/2004 ]
Quote:please let me know when you do I would gladly appreciate it so I dont have to miss out on all this money cause I dont have any money
On 2004-03-14 13:58, myfrogger wrote:
I am in the process of a very concentrated effort to set up millions of dollars worth of private money. I'll post my strategies and information in an acticle in the upcoming future. Look for it in around 3 months!
Private lenders are for real!
GOOD LUCK
Steadydoses,
You seem to find a lot of good deals, but you're credit is holding you back a lot of the time. You should start out wholesaling or just something that is going to start bring you money on a consistant basis. Build up some cash quick, and then with some of these deals you seem to be finding...you'll be set !!
JB
[addsig]
I am new in the investing field with no money but with good credit.
I'm told wholesaling is good to start with but since I'm at SF - Bay Area, where it's very hard to find such properties. Most of the properties sales with at least equal or higher then asking price and most of the properties has 5-10-15 offers within a week when it comes in the market for sale.
So, anyone has any suggestion for me. Do you suggest any specific area for wholesaling?
Thanks,
JAG
Quote:
On 2004-03-14 15:53, Jagdish wrote:
I am new in the investing field with no money but with good credit.
I'm told wholesaling is good to start with but since I'm at SF - Bay Area, where it's very hard to find such properties. Most of the properties sales with at least equal or higher then asking price and most of the properties has 5-10-15 offers within a week when it comes in the market for sale.
So, anyone has any suggestion for me. Do you suggest any specific area for wholesaling?
Thanks,
JAG <IMG SRC="images/forum/smilies/icon_smile.gif">
JAG,
I don't really know the market in you're area...so if properties go as fast as I've heard there, then this may or may not be the best advice I can give you.
But I would say start with lower end properties in wholesaling. Contract older homes that need ALOT of work (at the right price of course), and wholesale it to rehabbers. Now, you need to do a little reasearch first, you can read on this website all day and learn as much as you want to, but depending on how fast you want to learn...I personally would recommend buying a course on wholelsaling.
But I do hear this a lot about areas in california, and Las Veags, Nevada. It would be great to be able to wholesale a big profit deal (like one of those that are on the market for 2 hours before they're snatched up) , but if you want to do it on a consistant basis...lower end properties will be easier to come by.
Just my opinion, like I said I have no idea what the SF-Bay area is like or what's going on in that part of the country.
Good Luck.
JB
[addsig]
Hard money lenders I believe comply with securities laws and regs because they are pooling funds.
With private money lenders, you can NOT pool their funds, or you risk going to jail should some attorney see that you are pooling funds and not complying with the SEC.
One money investor = one deal. I am trying to set one of these deals up right now between a money investor and a rehabber.
Also, you can not advertise or solicit via the media for people looking to act as your cash investor, it has to be done through word of mouth.
Now, one workaround I think is to hold informational seminars for the public for this kind of investment. Then, if you do it right, you could probably talk to those attendees face to face, but you must be careful with this issue.
Best, Dave
Why not find a partner who has decent credit. Pay them $5K for the deal to get funded in their name, have them Quit Claim it to you, and you're on your way.
I have tried the partner with good credit thing but the only problem with that is they think you going to ruin there credit even if you tell them there credit is secured by the Real Estate or tell them that the property has a very high cash flow in a great market its hard to sell people on there credit because thats a very sensative topic, plus they have to trust you, and most of all and I know this is hard for everyone to believe but I live in the GETTO! no one here even know what Real estate is let alone have good credit I have the best credit in a 10 mile radius with a 520 score but still I know were there is a will theres a way...Peace!
I have a line on $35,000,000 or more in Texas but that's about it! Try Zelenko properties - they are in your back yard.
C-
Quote:I didnt understand your post please be more specific
On 2004-03-15 11:33, cpifer wrote:
I have a line on $35,000,000 or more in Texas but that's about it! Try Zelenko properties - they are in your back yard.
C- <IMG SRC="images/forum/smilies/icon_eek.gif">
Somebody would be crazy or stupid to accept $5k . The only way you are going to get somebody to put it in their name is if you go 50/50 split on profits when you sell.
You need to attract other investors with a lucrative deal, you can't expect to make tons of money while your partner makes nothing yet funded the deal.
Hi steadydoses!
I can tell from this and some of your other posts that you are very desparate for a deal, and that your very focused on what YOU have to gain or lose. Sure, we all need to make money, but my suggestion to you would be to put the shoe on the other foot.
Pretend that you have 110k (or whatever) sitting around and someone comes up to you wanting to 'invest' your money. This person has no money, no credit, no experience, no references, no current work history, and lives in an undesirable part of town. Reguardless of whether or not this information is relevant to the deal, I'm just asking you to think about it. What offering (50/50, 60/40, 70/30 etc) would it take for you to do the deal with this person?
There is more at stake here than the money on this deal. If you're willing to give up a substantial chunk to a PM investor, and the profits materialize, you've gained $$ for other deals. If the profits DON'T materialize, you will have gained valuable experience, and shown that you are considerate to the investor and you still may have an investor for future deals.
If, however, you treat your investor poorly, the money wells will dry up because the PM investor will tell EVERYBODY they know not to do deals with you, and why.
To be in this business you must have integrity and good character. You must be trustworthy and honest.
If your motivations are selfish and desparate they come through in your communication to others, and could turn them off to your offer.
I apologize if I've offended you or anyone in any way with this post, it's my take on it and I may be way out of line with my comments.
I sincerely wish you successful investing and good fortune.
What you are referring to is commonly called equity sharing. riot8ap is correct. Why would someone use their credit and not really benefit from the deal?
What normally happens is someone will use their credit to get funding for a deal. In return you do all of the work/research and you split the profit 50/50.
This technique is used all of the time. You just need to make sure you do your due dilligence before you present the deal to them. This will help you get more interest in working with you.
I have actually done this myself with someone who could not qualify for financing on their own.
I hope this helps!