Investment ProcessPrivate Mortgage Investment Process
Our company accepts private mortgage loans on a per property basis. The following steps outline the process involved in a typical deal funded by a private lender.
1We identify an investment property and negotiate a discounted purchase price and terms.
2A Lender Opportunity Package is sent out requesting funding for the deal including estimated value and all the investment purchase details.
3A lender is selected and provides a Letter of Commitment (LOC) to fund the project according to the contract closing date.
4The purchase contract is sent to the attorney’s office or title company, title search is ordered, and they will start preparing the rest of the documents.
5Closing: Lender provides certified funds to title company (direct from personal account or retirement fund); All documents are signed and the transaction is complete.
6Documents created for the private lender at closing:
- Deed of Trust
- Promissory Note
- Title Insurance Policy
- Fire/Hazard Insurance
7With the purchase transaction complete, the property is remodeled, and either marketed and sold or held depending on the terms of the private mortgage loan.
8The private money loan including principal plus interest is paid in full upon the sale of the investment property.
9The private mortgage lender has the option to receive payment or invest in another deal.
Typical Loan Terms
- Short-term loans vary between 6-24 months
- Longer-term loans are typically 2-7 years
When our firm pays cash for a house, we prefer to use private lenders instead of bank loans because this approach affords us maximum flexibility to quickly and creatively structure the most profitable deals.The availability of capital is more importand than costs. The quick availability of cash makes it possible for us to purchase good deals with large amounts of equity that we would otherwise be unable to acquire.
And since we are able to get a very high return on our real estate purchases, we can offer our private lenders high fixed-rate yields-often double digits-when using their money to fund our deals. Everyone wins!
Interested in Becoming a Private Mortgage Lender?
Our company sometimes offers individuals the opportunity to invest in real estate with Private Mortgage Loans. We offer fixed rate yields well above those earned with more traditional investments. Our process is well documented and all Private Mortgage Loans are secured by Deeds of Trusts against individual properties.
There Are No Hidden Costs: There are no commissions or "sales load" taken out of the loan dollars. We pay all costs involved to close the transaction. There is no cost to the investor. Any costs to the loan with the closing agent, recording of documents, title insurance, appraisal, or hazard insurance are paid by the borrower.
Contact Us Today to learn more about our program and how it works.
