I heartily agree. My lenders have come from being involved in Real Esatate Club meetings, past deals, and general good Relationship Building activities. The amount of money available is large from my experience and being Trustworthy is the best way to access it. Now is the time to find these lenders.
I recommend joining a local RE club. Also, talk to your lawyer, I find they have vast networks of lenders. Of course Mortgage Brokers, but they will hook you up for a fee typically. Not bad, there are just cheaper ways.
This question is for all of you out there who have private investors fund your deals. I was wondering. In Cowgill’s course he says that his properties are secured by an 80% LTV. Is that 80% after repairs (ARV) or before renovations? Thank very much for any input.
Re: Private Loan Investors and 80% LTV… - Posted by jasonrei
Posted by jasonrei on September 28, 2003 at 02:19:04:
I don’t know who Cowgill is or what his parameters are, but I’ll tell you mine.
I wouldn’t borrow much more than purchase plus repairs, and I usually buy at 50-60% of ARV. I’m looking at my deal board right now, and there’s not one deal on it where I would have felt right about an 80% of ARV loan- realize that the houses I buy are rehabs, pretty houses might be different.
THank you so much for taking the time to answer my question. I am trying to establish my private investor network. Building a relationship on trust and accomplishment are my main objectives. However, the first deal or two will have to be made purley on the numbers, at least until I can form a track record. That is the reason why I am asking such detailed question.
Once again, thank you for taking the time out of your busy schedules. It sounds like you all have done a few of these deals before. What standards did you use before you had an established track record?
Re: Private Loan Investors and 80% LTV… - Posted by ken in sc
Posted by ken in sc on September 25, 2003 at 07:09:27:
I have found that with private investors it is our relationship and their confidence in me - not the LTV - that makes the deal. In other words, my investors loan me the money, not loan money on the property. You must develop the relationship based on friendship, trust, and respect. None of my investors ever really know anything about specific deals or ask for comps or LTV or anything like that. Of course, I protect tem with all the needed paperwork, insurance, etc. And you wouldn’t get into a high LTV deal anyway, would you?
Develop the relationship, guard your investors money as if it were your own, and you can have good long term investors.