Real Estate Investing With Private Lending
The financial events of the last several weeks have most peoples head spinning. If it is not Fannie and Freddie being bailed out, it is AIG, Wachovia, WAMU or Lehman failing and forcing the US Government to take them over or filing bankruptcy.
And now we have passed a $700 billion bailout package for the Wall Street banks. As a result of the credit crises, the real estate mortgage market is freezing up and banks are now requiring super human credit scores and multi-year employment history to get a mortgage for homeowners or real estate investors.
Real estate investors are really getting hit hard and have no shot at getting traditional mortgages and are being squeezed out of the mortgage market. This is happen at the very moment that real estate prices have finally dropped enough that attractive deals are starting to present them self. They say that the best time to buy is when there is "blood in the street". Well there is blood in the streets now and it may be a historical buying opportunity.
Despite the credit crisis and coming recession, money is still being made in America. You may be aware that both Warren Buffet and Donald Trump are both in high gear and buying into this credit crisis.
But these times require specialized knowledge, vision and savvy to recognize and profit from them, especially in the case of real estate.
For example, instead of seeking a loan from the bank to purchase real estate, the savvy real estate entrepreneur will utilize private lending as a viable alternative to raise funds for deals.
Private lending is the practice of borrowing money by a real estate investor to be used to purchase rental real estate directly from private lenders rather than a bank or other commercial lender. Private lenders tend to be ordinary people such as doctors, lawyers, accountants, business owners and possible retired people. Most private lenders are simply looking for better investment returns than they can typically get from bank CD's, money markets or even bond investments. Over the past couple years these type investments have yielded a paltry 3% to 6% pretax rates. After taxes and inflation these investments have, in some cases, produced negative returns for their investors. This is why people are looking for better returns and private lending is the answer.
Private lenders are looking for returns in the 9% and 15% range and secured by local rental real estate. This kind of return will provide investors with positive investment return of almost 300% over CD's and money markets. The result is a perfect match of private lenders looking for better returns on their money and secured by real estate and real estate investors looking for cash to fund deals and the ability to pay higher returns.
And now we have passed a $700 billion bailout package for the Wall Street banks. As a result of the credit crises, the real estate mortgage market is freezing up and banks are now requiring super human credit scores and multi-year employment history to get a mortgage for homeowners or real estate investors.
Real estate investors are really getting hit hard and have no shot at getting traditional mortgages and are being squeezed out of the mortgage market. This is happen at the very moment that real estate prices have finally dropped enough that attractive deals are starting to present them self. They say that the best time to buy is when there is "blood in the street". Well there is blood in the streets now and it may be a historical buying opportunity.
Despite the credit crisis and coming recession, money is still being made in America. You may be aware that both Warren Buffet and Donald Trump are both in high gear and buying into this credit crisis.
But these times require specialized knowledge, vision and savvy to recognize and profit from them, especially in the case of real estate.
For example, instead of seeking a loan from the bank to purchase real estate, the savvy real estate entrepreneur will utilize private lending as a viable alternative to raise funds for deals.
Private lending is the practice of borrowing money by a real estate investor to be used to purchase rental real estate directly from private lenders rather than a bank or other commercial lender. Private lenders tend to be ordinary people such as doctors, lawyers, accountants, business owners and possible retired people. Most private lenders are simply looking for better investment returns than they can typically get from bank CD's, money markets or even bond investments. Over the past couple years these type investments have yielded a paltry 3% to 6% pretax rates. After taxes and inflation these investments have, in some cases, produced negative returns for their investors. This is why people are looking for better returns and private lending is the answer.
Private lenders are looking for returns in the 9% and 15% range and secured by local rental real estate. This kind of return will provide investors with positive investment return of almost 300% over CD's and money markets. The result is a perfect match of private lenders looking for better returns on their money and secured by real estate and real estate investors looking for cash to fund deals and the ability to pay higher returns.
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