Real Estate Investors Association of Greater Cincinnati

After my banker cut me off, I had to turn to another source to be able to fund my real estate deals. I quickly learned the power of asking and the importance of asking for that you want in this world.

1. You make the rules. Whenever you’re borrowing money at the bank, they get to make all the rules. They give you the interest rates, the payments, and the terms of the loan. Conversely, when you borrow money from private lenders, you get to write the rules and set your own terms. In the end, this gives you more control over the deals you make with lenders, the exact opposite of borrowing money from the bank.
2. No monthly payments. The vast majority of deals I make with private lenders do not have monthly payments. We set up quarterly, biannual, or annual payments that allow us more freedom and flexibility. A lot of deals that we have in place don’t require a payment for a full year. This helps us to free up cash flow whenever we need it.
3. No origination fees. When you borrow money from the bank, you’re typically going to have to pay an origination fee. This essentially just stacks up to another point being added to your loan, which costs you more money in the end.
4. You can close quickly. Time is always a factor in this business, so you don’t ever want to waste it. Borrowing private money can help speed up the process of buying or selling a home. I’m able to close deals in less than a week and have even been able to get a deal done in 24 hours.
5. Receive multiple checks. Borrowing private money allows you to get paid when you buy a property by borrowing more money than needed. My favorite phrase on the checks I receive from my real estate attorney is “excess cash to close.” You get the entire amount from the lender, so you can purchase a home or rehab materials. You can even receive multiple checks from different lenders for the same deal.
6. No credit checks. As a real estate investor, my credit has nothing to do with the money I receive from private lenders. I’m able to collateralize the loan using the house or apartment complex itself. The real estate is the collateral, so both parties get the same protection or security as the bank would offer.
7. Tap into an unlimited money supply. Whenever I borrowed money from the bank, I had a limited line of credit. Using private money, I no longer need to worry about that. There is currently $18-trillion in private money that could be used as funding. I show you how to locate it fast and easy.
8. No need for a personal guarantee. When I borrowed from the bank, not only did I have to put up the property itself, I had to put up everything I owned as well. This is something I no longer need to worry about with private money.

The bottom line is that private money is virtually unlimited, and there is truly no better way to fund your deals, so ditch the bank just like I did.