Private Lending Opportunities

As a real estate investor since 1994, I have used mortgages and loans from private investors since 1999. These private lenders typically receive interest rates of 12% to 18%. The private loans are also structured with a minimum interest of 12% to 18%. This provides an opportunity for an annualized rate of return of 30% to 60%, for the private lender. This is not the norm, but it is possible when things go well.

Let us take a small loan for building materials of $10,000.00 with an interest rate of 15% and a minimum interest of 15%, for example. If the property is sold 6 months after the loan is made. The private lender receives the $10,000.00 principal, plus the minimum interest of $1,500.00. Since the loan was paid back in 6 months instead of a year, this provides an annualized rate of 30%.

Not only have these secured private loans provided some excellent rates of returns for the lender. They have allowed me to score big.

In 2004 I was able to use a private loan to acquire a property in northern Indiana. The property did not qualify for a mortgage from a bank due to repairs that needed to be made. It took 48 days to complete the repairs, sell the property, and close on the sale. The net proceeds after closing were over $100,000.00.

In 2020 I sold a property for over $50,000.00 that was purchased for $1,000.00. The money for the repairs and renovations was obtained with a $25,000.00 mortgage from a private lender.

Documentation of the above examples is available, for review, by request, for serious prospective private lenders.