Tweet

What About Private Lending?

Guest post by: C.J Lauria

Article Overview: Financial loans are financial opportunities in disguise. It can provide the private lender a great return on their money while securing their funds with a note in first position on your new home at a loan-to-value of 65-70%. In this down market property values present a terrific opportunity for securing retirement funds as well.

What About Private Lending?

If you have tried to get your mortgage note modified and opted to short sell the family home, this may be for you.

In the case of a short sale two facts remain constant. First, you will sustain damage to your credit rating for at least 24 months. Second, you will have to move.

There has traditionally been a third inevitability and that is that you would become a renter again. The latter is least preferable as it means the loss of some distinct tax advantages that come with home ownership. These will be discussed in a later article.

In the meantime, the question is whether it is possible to maintain homeownership status with severely handicapped credit? The answer is: “possibly.” With private money many doors can open up to families with a solid household income.

Financial loans are financial opportunities in disguise. It can provide the private lender a great return on their money while securing their funds with a note in first position on your new home at a loan-to-value of 65-70%. In this down market property values present a terrific opportunity for securing retirement funds as well. Free information on that subject can be obtained by calling 1-888-380-INVEST and requesting a CD on self-directed IRAs.

Private funds also allow for flexible terms. Maybe your “sweat equity” and a partner’s cash can make a winning combination together. Either way, the sky’s the limit.

Don’t underestimate the power of the human heart. People have a nearly inborn need to feel as though they are making a difference in the lives of others…especially those whom they care about. You may be surprised to find others are more than a little enthusiastic to help you realize your dreams. Why not share these hopes and dreams with those in your life? It may prove to be the best financial move you make this year!

Be prepared to provide the “complete picture” for any prospective investor. Make sure you have accurate numbers and all available facts about the new property. This will make their decision much easier….and you look better. As with any business transaction: Put it in writing! Provide your lender with a Note and Deed of Trust and have it recorded with the county. It is best, too, to have your lender named as “additional insured” to protect them against any catastrophic losses.

In conclusion, as the banks get weirder and weirder, it will become increasingly more necessary to get creative with financing. Private money is a great vehicle to make deals happen. You will likely pay a higher rate of interest but it may make the difference between having the deal and not having it. Here’s to home ownership!

Related Articles
  Defining “Hard Money”
  TAPPING PRIVATE LENDERS FOR YOUR BUSINESS OR REAL ESTATE LOAN
  Avail Affordable Car Loan Financing Rates
  Reinventing Your Business Funding with Asset Based Lending Companies
  Franchise Financing Sources
  Determining if a Business Plan or Regulation D PPM is your best option.
  PRIVATE MONEY IS THE WAY TO GO
  Now Even Regular Folks Can Be Investors!
  Good Decisions Around A Commercial Business Financing Loan In Canada – Canadian Lending Options
  Smarter & Faster Canadian Business Financing - Why Asset Based Lending Credit Facilities Work!
  What Are Recourse and Non-Recourse Loans?
  How Canadian Cash Flow Finance & Mezzanine Lending & Financing Differs From Lenders Offering ABL Solutions
  Asset Based Lending
  Banks Continue To Hold Back on Lending
  Still Can’t Get A Business Loan?
  ALTERNATIVE ENRICHMENT
  Requirements for a Business Line Of Credit in Asset Finance and ABL Lending in Canada .
  SBA Loans
  What’s a small business to do regarding financing?
  Times are tough with the credit crunch!

Article Tags: Buy Homes, Buy Houses, Cash Home Buyers, Cheap Homes, Cheap Houses, Private Lending, Real Estate Investing, Real Estate Investment



Related Forum Posts
Securities - Lending guru: I assume your securities offering has been registered - since you appear to making a general public solication
How to valuate a business - Hi Garth - here is how we did it at Northern Crown Capital when I was helping them raise venture capital for Toronto-based entrepreneurs. Assume the start date is 2003 so 2008 projections are 5 years out: How Northern Crown Capital Valuates a Business 2008 Financial Projections Earnings Before Tax $5,865,000 Tax Rate 42% Taxes $2,463,300 Net Earnings $3,401,700 Amount Seeking to Raise Today $3,500,000 Discounted Value of Future Opportunity, 5 Years Out 2008 P/E Ratio 15 Value of Company in 2008 $51,025,500 Discount Rate Applied 30% Year 2008 $51,025,500 Year 2007 $35,717,850 Year 2006 $25,002,495 Year 2005 $17,501,747 Year 2004 $12,251,223 Value of Company at Investment in 2003 $12,251,223 Less: Investment Amount $3,500,000 Present Value $8,751,223 Discount for Risk & Private Company 40% Less: Discount for Risk & Private Company $3,500,489 Private Company Value $5,250,734 Present Value (What the Owner Keeps) $5,250,734 60.00% Financing (What the Investor Gets) $3,500,000 40.00% Total $8,750,734 100.00% I hope this helps!
How to get financed - We looked at doing the same thing. Problem is you own the truck out-rite, so most require a add on to your title or release of title to them for liability should you default. Contact Kevin at RV Lending, he assisted us with our stacker transporter, pretty easy to deal with and straight up with the answers before you give all you personal information. Good luck
Getting financed for conversion on an older truck - We looked at doing the same thing. Problem is you own the truck out-rite, so most require an add on to your title or release of title to them for liability should you default. Contact Kevin at RV Lending, he assisted us with our stacker transporter, pretty easy to deal with and straight up with the answers before you give all you personal information. Good luck
Re: Bad credit guaranteed home loan? - Lending money to people with bad credit was one of the biggest things that put our economy under and many lenders out of business. I'd say if you have this opportunity take it now before it goes away. Trust me, if there are any of these programs left (and don't expect a low interest rate if your credit is bad) they won't be around for ever. At ANY interest rate.


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

9 tips to increase ROI in PPC Campaigns

3 Competencies of Leadership

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.