by Gagner | Mar 8, 2015 | Trust Deed Investing
Private money lending for real estate Most people have been conditioned to believe that earning double-digit returns is only possible for those willing to take large financial risks. I am here to tell you that it is not true. I know this because my private money lenders earn these types of returns, while being exposed to risks far less than what I believe the stock market offers. Our private-money lenders have their loans secured by actual real estate assets. In the “worse case scenario” (the occurrence of a major, unexpected problem), the principal can be recovered thru the foreclosure process. How does the process work? There are 3 steps we follow in California: 1. Bridge Equity Group and their private money lenders come to an agreement on terms. These are typically loans for 12 months with no pre-payment penalty. In most cases, loans are paid back in less than 6 months. 2. Once a house is in contract, the borrower signs a promissory note (legal document that defines all terms of the loan) and a deed of trust (legal document that secures the loan against the house). At close of escrow, the title company records the deed, which places a lien against the property. With a lien recorded against the property, it cannot be sold until the loan is paid in full. 3. Property is the rehabbed and sold, at which point the lender is paid back their principal and all accumulated interest. The key is to work with borrowers who have a successful track record, experience, and integrity. I recommend that you always check references. In addition, there...
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