Your rate of return varies depending on your needs. We can offer you a higher interest rate (currently 12%) if you don't need monthly payments (and let your interest be paid when the loan is paid off).

If you are looking for annual, quarterly, or monthly interest payments, your interest rate will be lower.

Yes! This arrangement gives you security through a mortgage secured by real property at a great loan to value ratio to protect your investment. Your loan value will be no higher than 80% of the value of property securing the loan. This means if a house appraises for $100,000, you wouldn't make a loan for higher than $80,000. That's an 80% loan to value (LTV).

It's obvious why this is a much safer approach than most lending institutions take. Many bankes make loans at a 90, 95, or even 100% loan to value ratio for homeowners leaving no cushion in case of default. In contrast, when you are dealing with a maximum of 80% LTV (on a first position loan) there is so much equity above your loan that if for any reason you had to take the property back, it could quite often be quickly sold for much more than your investment and interest earned.

Exceptions. You LTV rations may change depending on the amount of investment and the program we design for you.

No! We never pool more than one person's or company's money to create a mortgage. You make the loan yourself. You get a lien against the property as if you were a bank and remain in total control of your money.

Most often the loan amount will include purchase price, repair costs, and closing costs, but again the LTV will never exceed 80%

In this region it is difficult to buy homes with a first mortgage position for less than $200,000. For those who may have less capital than a first position would require, smaller loan amounts such as $15,000 or $20,000 can be used as a mortgage secured by a second position, but it will likely be at a slightly higher loan to value ratio such as 85%.

Those investing less than $20,000 can make several smaller loans to keep their funds working.

Usually a real estate investor wants a three-year term in order to allow time to sell the property with your mortgage on it without having to replace your investment early.

The more flexibility you have in your terms, the more likely your money will be working hard for you. We prefer no payments, with a ballon in a few years, similar to a CD.

Whenever a house is sold, all liens must be paid in full. This may be well before the three-year commitment we initially asked for. At the time of the sale, your mortgage balance (including any interest earned) will be returned to you.

If you want to keep the money, it's yours to keep. If you have enjoyed the rewards of doing business with us, and we're sure you will, we can use your money to purchase a new property, and you will get a new mortgage with the same great yield. You can loan your funds indefinately.

You really shouldn't make maortgage loans if you feel you will liquidate shortly, but the option is always available. Most likely we will replace your loan with another private mortgage lender.

Keep in mind mortgages are not as liquid as a checking account and it will usually take four to six weeks to replace your financing, and a small fee will apply to cover our transaction expenses. This is typically 2% of the loan amount. A bank is much less forgiving when releasing a CD before maturing.

We, along with our local real estate attorneys and settlement agencies will handle all of the details at no cost to you. We rely on our settlement agencies to create the proper documentation to protect your interests and ours.

Your closing package will contain the following: - An original promissory note - A copy of the Deed of Trust (mortgage). The original will be recorded and then sent to you. - A hazardous insurance endorsement naming you as mortgagee - A quarterly earnings statement

Red-tape, slow response rates, "seasoning" issues, arbitrary caps on the amount one can borrow, inexperienced and inflexible bankers are just some of the reasons why many investors prefer the convenience that comes with private lending.

Our real estate investors typically buy about 30 to 50 deals per year. They search for great opportunities everyday and are looking to buy houses for pennies on the dollar of the actual market value. Most sellers of these types of properties need cash and they need it quickly. In order for the investor to get the very best price, they need to close the deal quickly. The investor needs readily available cash, which of course banks cannot do.

First, banks often require substantial down payments from real estate investors (unlike homeowners), reasoning correctly that the more money a person has in a home the less likely they are to default on the loan. They figure that the 5%-30% down will give them enough cushion should they need to liquidate the house to recoup thier money. What they fail to take into consideration is that the proffessional real estate investor is buying houses as much as 50% off of what we would call the retail price of the home. These houses have substantial equity built into the deal. Always having to come up with down payments drains most investors of the cash they need to repair and market their properties. It's a legitimate problem.

Secondly, banks are obsessed with credit reports and credit scores. This number is based on a number of factors including the total amount of debt someone has (most professional real estate investors have millions of dollars of mortgage debt) and how many times borrowers have applied fo rcredit in a 24-month period (the more times, the lower the score). If someone buys 25 homes a year, they'll have 25 credit inquires and their score drops sharply. In truth, the more successful they are the less is their ability to borrow.

Third, banks are very hesitant to make loans to entities, even when the borrower is willing to sign personally. This is a huge problem in that astute real estate professionals always own properties in entities (LLCs, corporations, land trusts, etc.) The rules of banks are aligned against the legal intelligent and wise protection of ones assests.

Fourth, every lender in the world has a maximum number of loans they'll make to any one individual, na matter how good a customer you are. They also have limits on the amounts of mortgages they'll give to single investors. These limits aren't very high, particularly if you wish to build a vibrant business. Limits of four loans per person, or $350,00-$500,000 are common. A cap at that amount doesn't go far in this region and the laws are becoming more restrictive over time! Professional real estate investors are coming more and more to rely on private sources of capital to fund their deals.

Lastly, paperwork! Mountains of it, with every single loan!

Can you see why private lenders are so much more attractive to professional real estate investors? Even with the higher rates of return to borrow your money, you're a great option over the inconveniences of banks. For us, it's not the cost of money that counts but the availability.

Yes! We are currently working with lots of private lenders who much prefer our hassle free process and rewarding returns. Contact our office and we will be glad to provide you a list of private lenders who have given us permission to share their information.

Keep in mind this is our business and credibility is extremely important to us. The real estate investor doesn't need to be in possession of your money. Simply wire funds (or mail your check) directly to the closing agent for the gross amount of the loan. The closing agent will then handle the closing. You should have no expenses.

We have never defaulted on a loan, whether personal or secured by real estate. However, there are several options in the event of default by your borrower. Foreclosure is only one of them and is usually last on the list. You can negotiate a payment plan with the borrower or the borrower may elect to simply deed the house to you, thus avoiding a foreclosure process.

Remember that you are protected by a low loan to value (LTV)

Yes! Our property investors follow the LTV guidelines we've discussed to protect their profit margin, which protects your loan. And unlike mutual funds, stocks, or CDs, your principal is backed up by real property. Your money will grow two, three, or even four times faster than your current investments and in addition, you maintain control of it. Your portfolio can still be hassle free and produce amazing yields!

Simply by transferring your 401k, IRA, or pension plans to a self-directed retirement account that you control. Your money will still be tax-deferred just like it was before, only now you get to tell it waht to do. We will assist you in this simple transfer process to get your money working again. Call us for more details and we'll be glad to help!