SPC070 - Fundamentals - What is Private Money Lending- Two things I look at in every PML deal - a podcast by Lane Kawaoka, PE

from 2017-08-29T19:32:05

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There have been a few Private Money lending deals coming through the deal pipeline. Make sure you are on the list.

What is it?

It is probably to first strategy people should try to get their feet wet. And for people with skeptic spouses it shows how the checks come in.

Any time someone wants to borrow money from an investor to undertake a project. It can be short term or long term.

Great strategy for a sellers market

1st lien 2nd lien position

9-15% returns or 10-20% returns on 2nds, wide range

Based on relationships

Loan to Value LTV - 50-75%

Home flipper looking for 70% LTV and they also include rehab costs

Don't just look at the rate of return - Subjective nature development or cashflow - what is it based on flip to rental or flip to retail

What is your downside if the flipper does not perform - what can it rent for? Seattle vs Birmingham

deed in lieu - work and headache

Another option is crowdfunding sites however there is another person in the middle making fees

you are not going to made substantial wealth with this method but a great way to keep your liquidity moving

not everyone's situation is the same

If you are still trying to grow your wealth you need to get into equity deals and not debt deals

Don't just chase the high IRRs

SPC054 - Fundamentals - Debt Deal vs Equity Deal

#LaneHack #JustTheTip

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