Are you about to embark on the real estate adventure of a lifetime? You’ve been preparing for this your whole life and you’re ready to start making plenty of deals to get your real estate business off the ground.
For many of you, it’s going to be difficult to get funding when you have little to no credit and no experience. In these situations, private money is definitely a valid way to get started.
Do you hope to raise private money in the future for your deals? If so, please use the following tips and suggestions to make this possibility a reality.
Tip #1: Tap into Your Existing Network
Believe it or not, your existing network might be able to get you in contact with private money lenders and you don’t even know it. So instead of ignoring the people that are already in your life, it’s time to pick up the phone and begin making calls right away.
Even if you do not know any private money lenders, the people in your network may be able to connect you to an existing lender or two. So call around and ask business associates, friends, and family members if they can connect you with anyone offering private money to fund your deals. You never know who may be able to put you in touch with the perfect contact.
Are you a member of any real estate clubs or organizations in your community? Ask around to the members of these clubs and organizations to see if they know anyone to help you. If they do, they’ll probably connect you to someone with a trustworthy reputation, which means you’ll have access to a quality lender that you’ll find without any difficulty whatsoever.
Tip #2: Don’t Be Afraid to Show Your Success
Whether you know it or not, people like doing business with other successful people. The best way to attract private money lenders is to show them you are already a successful investor.
There is a catch to this method though and it’s serious. According to laws put forth by the SEC, you aren’t legally allowed to advertise. Yes, it’s crazy but it’s true.
You cannot legally attempt to advertise that you’re looking for money. Or on the flipside, it’s also illegal to advertise that you’re funding if you’re a lender. If you were ever to get caught you could end up in serious trouble. This makes it tough to find funding at times.
So do your best to get the word out about your success without advertising that you’re looking for hard money. This is a great way to attract lenders who end up coming to you.
Tip #3: Build Relationships
Most important of all is building relationships. By connecting with and getting to know the big players in the business, you’ll make strategic contacts and partnerships with people that can help. You’ll discover and befriend hard money lenders that have no problem funding your deals once they’ve gotten to know, like, and trust you. So remember to schmooze with the best of them and start building relationships with others in the business ASAP.
In conclusion, we’ve learned that building relationships, showcasing our success, and tapping into our existing network are excellent ways to raise private money to fund our deals. Please use these suggestions regularly to get the funding needed to realize your real estate investing dreams.