Private Money Loan Recommendations?

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I had someone email me an interesting question recently:

I had a quick question about private money loans. Have their been any posts on this? I tried searching “private money”, “hard money” but nothing came up. I’m looking into rehabbing a house and conventional lending isn’t going to work for me, so I was wondering if there are any recommendations or guidelines for obtaining private money?

The closest thing I can remember is a site called Prosper (I wrote a note about it) where people can loan other people money. However, I’m almost positive they are geared toward small loans like paying off credit card debt, so I don’t think it would help for home remodeling projects. Also, when I did a bit of searching, I see Brian Bradu covered the topic of private money loans a little while ago, but his angle didn’t include any guidelines or recommendations for finding a private loan.

Is this a common thing? Is there a good source of information for private loans? My gut says that most private money loans are probably among family/friends, but I wouldn’t be surprised to learn that there was an existing market for this kind of thing.

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53 thoughts on “Private Money Loan Recommendations?”

  1. Prosper allows you to borrow up to $25,000 per loan (depending on your state), so it could be a valid option for rehabbing a house (after all, most individual projects can be completed for less than $25K, even if the whole house costs more than that to fix up). I didn’t see anything on Prosper’s website about any maximum cap on the total number of loans you can have (but it does show your debt-to-income ratio, so the more loans you have active, the higher your interest rate will likely be).

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  2. The UK also has a system called Zopa that is coming to the US. I have been following their site for awhile as they gear up for US launch. They were featured in a Business 2.0 article awhile back.

    http://www.zopa.com.

    Not sure if there is a cap or restriction on loan reason and it sounds like it is similar to Prosper to me but the Zopa people assure everyone it is much better.

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  5. I don’t know about in your area, but here in the Fredericksburg, Virginia area there are several “private lenders.” They generally only lend in situations where the buyer or owner has substantial equity in the home. They don’t advertise themselves around here. I have encountered them acting as investors that run a sideline private lending business.

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  6. Hard money lending is available in WA. The note rate or interest rate will be 10%+. The loan fees will be 3-10 points. Your primary residence is usually the security collateral. the hard money lending industry has some not so reputable lenders and some reputable lenders. I can refer you to a couple reputable hard money lenders.

    Cheers,
    Michael P. Lindekugel
    Financial Analyst
    RE/MAX Commercial
    Team Reba – RE/MAX Metro Realty, Inc

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  7. Hard money and private money aren’t necessarily the same thing. Just today I found a private money loan that’s impressive. over 1 mil,no income,no asset and cash out and only 6.5%! better than any non private money out there.
    On a construction project, you could go fha203B if those loans are still out there, or get a construction loan, which we usually do. The construction loans use appraised as finished values and give you about 80% of appraisal. That’s usually enough. Of course, for the little $25,000 remodels, it’s not worth the cost. That’s what credit cards are for!!! Find one with 0 interest for 1 year and you’ve got a free loan!

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  9. Dustin,
    Have you looked into note brokers? I am not sure what you might have available on the west coast but they might be able to help you depending on what you have going on. Good luck.

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  10. Great stuff everyone… And Marlow, thanks for pointing out the Seattle Funding Group… I had no idea they existed!

    Apella, how might a note broker help? I could take a guess based on their name, but how do they work?

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  11. I have worked out a couple of private loans for a portion of funding, but not for the whole thing. I have to know the buyer/borrower well enough to vouch for them. When conventional lending doesn’t work, and private sources are used at reasonable rates vs. hard money, one has to know the story behind why conventional lending doesn’t work.

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  15. The only thing I’d add is that if you go the family route, get an attorney to prepare a note and deed of trust, and then record it prior to any funds changing hands. Otherwise the family member who you borrowed the funds from will be at risk if the member borrowing the funds declares bankruptcy.

    People always seem to think you don’t need to document loans with family, but those are the ones you need to document the most (assuming you want to repay them).

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  16. Hi My name is Kay and I need some help. My husband has his CDL license and we need to find someone who would be willing to loan us some money to purchase a truck. We have been married for 3 years and have a very low credit rating due to things that happened before we each got together. Robert is a very hard working man and does extra work to take care of me and my 4 kids. He has really stepped up to take care of us after their dad died 4 yrears ago. If ssomeone could tell if they know of anyone or any place that would be willing to loan the money to us. We will pay it all back plus interest as soon as possible. Please if you can help me let me know. Thanks,Kay

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  19. The last time I checked, my plus score or average was 649. I have approximately 10,000 to put down from my retirement. I was discharged 9/13/07 BK 7. The property is 11.2 acers approximately 2 miles from Shelton Vineyard on Melton Rd. I purchased this at $58,500 and oxwe $56,000 from Brandon Oakley and he can verify payments and my rental. I am wanting to put a on-fram modular, or a Stanley home on this property. I relize my loan won’t be favorable and even if you are unable, perhaps you could pass along my information to private investors who might do a hard loan for a time. I appreciate your time. My Phone is 336-789-5141 x 159

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  20. Good day,

    My name is Kent Brown,I am a private money lender,
    certified and guaranteed,you could get your loan
    from me as fast as you want it to be,all you need to
    do is to fill out this and send it to the provided
    email as soon as possible so we could start with
    your loan or you could send us an email for more
    enquiries: mr.kentbrown@gmail.com
    Name:
    Addresss:
    Phone number:
    Date of Birth:Occupation:
    Amount of Loan:
    Loan Duration Limit:
    Get back to my e-mail as soon as possible.Have a
    nice day.
    Call on:+447045762939.
    Best Regards

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  21. Hello,
    My name is Dean Miller. The name of my company is Pacific Northwest Mortgage Services. We have been placing private money loans for clients for over ten years. We handle both commercial and residential private money, big or small. I would be happy to answer any questions at any time. I can be reached daily at (425) 427-2969 or at deanmiller@pnwms.com

    Cheers,

    Dean Miller
    President

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  22. Hi I am looking for someone to loan me some money. I am a mom with two boys and I am married my boys are teenagers. I need to put all my bills in to one payment. this would help me out a lot. I need about $5000.00 this year has been a bad year for me. Is there anyone out there that can help please.

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  23. Looking for private funding to by HUD foreclosures in Henry & clayton county Ga. Annual growth in these counties has averaged above 10% per year. Investment secured by real estate at 60 to 65% of appraised value. Willing to pay 15% interest.

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  24. yes i have a question out there if anyone can answer this for me. i have been checking to get a 48-60month loan for 25-30,000. my question is this web site does give some private lenders to do loans like this, but do they always ask you for drivers license, bank name and name of bank manager, they said they can deposit the money into my credit card, but there should be nothing on it. they also say they have an attorned to set up the legal documents. this is the first time i have looked for a hard money loan on the internet. so do the posts that are posted by people on this web site are they all legal and legitmate people? in other words am i getting scammed and if who ever gets back to me would you know if the person i am dealing with if real? please someone try to answer me ASAP. THANK YOU BONNIE

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  25. Bonnie:

    I am a little new here (to RCG), but I think I can offer a bit of advice, without violating any RCG principles (no personal attacks, no blatant self-promotion).

    First, I would say the MOST important thing anyone can do when getting any loan, is to fully understand the written agreement that you sign. We loan originators tend to skip over some details in that regard, (or more accurately, point to only the salient facts) when we address a standard 30 yr fixed mortgage, as the terms are widely understood by the borrowers.

    This is NOT neccesarily the case for ARMS, balloons, subprime, etc., and may account for a portion of the current state of affairs in lending. A conscientious originator will explain anything when asked, until he is sure his client has a clear understanding of their obligations.

    Hard Money loans are anything BUT standard, but they are definitely a legal contract. Not understanding the terms (and inadvertently violating the terms) could cost you much more than any benefit you hope to gain by entering into it. The transaction ought to be done with someone local (wherever you are), as the diffiuculty of understanding the terms is only worsened by distance.

    Check out the credentials of whomever you are dealing with, whether they be an independent loan originator that will help you select from a variety of lenders, or the direct hard money lender.

    Whichever party helps you will expect to make a return on their investment of time. Hard money loans tend to be more expensive in costs, for many reasons, such as the investment the various parties must expend in time to get reasonable assurance it is a good investment, and the relatively short period in which to make it up on rate.

    Part of that investment in time (for both the lender and the borrower) is deciding whether or not it makes sense to begin the transaction. We all have a limited amount of time, and we all prefer to spend that time doing something pleasurable or profitable. Choose a few lenders or brokers, (based on the above criteria) exhange the necessary information as quickly as possible, and make a decision based on the feedback you get.

    Finally, in re-reading your message, I am beginning to think that when you refer to “this website”, you are not referring to Rain City Guide, but an internet site that is asking for private information.

    DO NOT DO THIS!!!

    These websites are not lenders, but lead generation scams, seeking to unfairly profit off of gullible borrowers, and desparate loan originators. They do not in any circumstance improve either parties position in the transaction.

    See advice above. Ask around, locally.

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  26. Dustin:

    I wrote this post #25, before reading all of the previous posts above.

    There are several offers from lenders to help in previous posts.

    Again, I am new to RCG, but is this one of the functions of RCG? To connect buyers and sellers of services?

    Such a service would certainly be valuable to both buyers and sellers, and there is no shortage of duplication on the internet, but isn’t that done more specifically elsewhere?

    Am I missing a nuance that should be obvious to me?

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  27. Roger,

    Generally speaking, whether it is RCG or any blog, it is not appropriate to blantantly advertise in the comments. Exception would be where the post is asking for resources, such as this one or mine on popcorn ceiling removal. Since the post is asking for “Recommendations” and resources, it is not inappropriate on this particular post.

    The length of the comment being longer than the post is generally not a good idea, but sometimes appropriate. If you have questions about blogs and blogging and commenting on blogs generally, feel free to email Dustin or me anytime.

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  28. Roger,

    Connecting loan officers up with consumers is definitely not a typical function of RCG and I STRONGLY recommend that people are extremely cautious before responding to anyone who has left a comment on RCG!

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  29. hello, i need someone who will lend me £3000 over1-2yrs, i need this money as myself and me partner are going for a vasectomy reversal and the price is £3000 now we don’t have long to get this money together, as each day passes the percentage goes down and down at the monent the percentage is 65-76%. this means so much to us so if there is any one out there that will us the money i will be so so greatful.
    thank you
    naomi x

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  32. Which service?

    Providing grants to people in foriegn countries who want to have children, that cannot afford to make them, much less raise them? For free….?

    Or providing advice on hard money loans, for folks that cannot give conventional lenders good enough reason to lend them money at less than 15% , with 65% LTV, and charging 5 pts? Won’t win many friends there!

    While I’m sure I know a little about both subjects, I’m afraid I don’t know enough about either to blogulate with authority.

    But if I had to pick one, the fertility angle sounds like it would be good for a few more laughs! 🙂

    BTW, Rhonda, I really admire your work! I am trying to think up something that’s not duplicative, and also matches my interests and expertise. Thanks for your encouragement, and pardon my flippancy, if it seems excessive. It is challenging to provide the correct nuances, in written form.

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  33. Roger, there’s plenty of room for more mortgage blogs. 🙂 If you just write from your heart and head, it will be great and not a duplicate of what I do. We might talk about similar issues but say things a different way and reach different readers.

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  34. Any Advice??

    I have attended the Robert Allen School. I am considering their software package called Dealmaker Pro. It includes comps, foreclosures, Short sale package, lendor presentations, anaylsis worksheet computaions etc. This is not an inexpensive package but is there another software package available somewhere that accomplishes the same, and at what price point? Help!!!and thanks for any input, positive or not.

    Bob

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  36. Goodday ,
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    Reply ↓

  37. Dustin –

    NuWire has published several articles on these companies. Prosper, Zopa and Lending Club all offer programs that are both beneficial to investors from the lending and borrowing sides, and merit consideration.

    Rather than burdening these comments down with links, I’d humbly encourage your readers to check these articles out by serching http://www.NuWireInvestor.com.

    Marie

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  38. From what I can understand J Woods is in Nigeria, the only collateral he needs is your money because he cant use your house because he is in NIgeria. That is what his basic message was to me. I emailed this guy out of curiosity, if the rest of the adverts is anything remotely like Jwoods steer clear.

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  39. Kay: LOL!!!

    I would definitely believe it and don’t recommend using anyone from the comments on this post to get a loan! I’d delete the bulk of them, but I find them kind of amusing.

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  40. I am in desparate need of $600.00. This money is to get some food and my husband’s medicine. He has had Diabeties for 42 years and now has heart problems and kidney problems. I work everyday, but my drive is so far and with gas prices I am spending over $100.00 week in gas. I am dead on empty now. If some can please help me today I would be forever greatfull. I can pay back $50.00 or $100.00 per month.

    God Bless

    Connie Glisson
    North Carolina

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  41. hi i woild like you to recomend a legit private loan lenderbas i have been scammes four times and lost of money. I have a poor credit score and my options is limited. I live in the uk

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  42. Im a full time real estate agent that needs funding to WIN BIG in this foreclosure market. MAKE UP YOUR OWN LENDING RULES!!!
    call anytime 513-418-8840

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  43. Well now I have Mr. Larry from Italy. He swears he is legitimate and was completely put out about the fact that I called him a scammer. I got an offer that I probably will be able to refuse. I really wish these people would get a life !!!!!

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  44. Looking to Rehab multiple houses in Northwest Indiana,
    Here is one of them on the table now:: Must Close ASAP.
    5 Bed, 2 Bath, 2038 sq, ft
    House has a current value at $103,000
    Needs approx $7,000 to rehab
    ARV $120,000
    My Purchase Price $71,000
    Total Loan Amount $80,000 cover closing Cost, Title work, etc.
    Must Close in 3 Weeks:::
    Will Pay 12% + 2 Points,
    1st Position Mortgage: Promissory Note;
    Lender Named as Mortgagee on the Hazard Insurance:
    Contact me directly at 219-313-7216

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  45. INVESTOR NEEDED FOR PATENTED GOLF GLOVE.I AM LOOKING TO RISE 50,000 TO EXPAND WORLD WIDE.NO DEBT,OVER 60 INDEPENDENT SALES REP’S READY TO GO.I HAVE FACTORY & PACKAGING COMPLETED.R.O.I IN 12 MONTHS BACKED BY PATENT & TRADEMARK AND 10% OF COMPANY.MY WEBSITE IS http://WWW.TEEGLOVE.COM PLEASE CONTACT ME @ 954-549-7384

    THANK YOU.
    BILL

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  46. I am looking for a personal loan. Is there anyone out there, besides all the scammers that are listed,willing to give a personal try? If there is really such a person out there, will you please get with me. I am in need of $5,000.00 and will work out a pay arrangement with you.

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  47. Marilyn,

    While I wish you the best of luck, I wouldn’t recommend looking for a personal loan on a blog post. It’s just too easy for the scammers.

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  48. This thread is just sad. You folks ought to close it down and delete the comments. This is worse than reading hard luck stories on Prosper. Yeah, pesople have fallen on hard times and need cash desperately. What does this have to do with Seattle Real Estate?

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  49. I am seeking a private personal loan in the amount of $5,000. I just started a new job and need cash flow for my monthly expenses until I can collect some pay checks going forward. I do not owe any installment debt or even have a car loan. My monthly expenses, (rent, utilities, phones, car insur. etc are $2,100). My personal credit is shaky because of a family business I was forced to close down. I am very honest and my resume is professional. I start my new position July 30th and have been searching for a while and have depleted my personal savings on expenses while seeking work. Please contact me if anyone has interest. Willing to give a healthy return.

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  50. I am looking for a private lender to lend me $5000 to clean up debt. I have poor credit and have had trouble getting a loan. Will pay back and leave payment arrangements up to the lender. Please contact me if anyone is able to help or can recommend a lender to me.

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  51. We are a private lender serving Wa. State. We are an asset secured lender who loans on equity. No credit checks. Security must be 1st deed secured. Rates start at 9% Term of 12 to 36 months. No owner occupied loans. Loans to $5 million. We have been at the same location for 25 years here in the Puget Sound. If you seek a no hassle loan with quick closing we are your best local bet. We also loan in Oregon and Idaho. Prefer cash flowing income commercial properties. Brokers protected. Call 206-817-7767 to discuss your funding needs.

    Reply ↓

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