nice
two of my customers do that as well and specialize in hard to finance and with commercial properties.
they take a 3% 'finders fee' which is added to the principal and then charge anywhere from 8% to 15% depending on the down stroke/ credit rating etc.
one customer has a million dollar line of credit for his business (not me) at 3.5% and lends out most of it and picks up enough on the % spread difference that he doesnt even need to work............ but will continue as he loves the thrill and the scent of fresh money
you only live once, but if you live it right once is enough
You posted your return before, as I recall it was an index less expenses, (I don't remember if I counted inflation then also) and it was under 6%, which is reasonable. However, it is an average, it is not consistent or safe, and does not allow for adjusted rate unsecured borrowing to enhance your results. If it is 9.5% before inflation and after expenses it is a very good result, congratulations, you did much better than average investor
‘Forbear to judge, for we are sinners all’
I expected exactly this answer.
Here usually you have to lend 25K+ and be in a second position in a residential or commercial mortgage.
If the borrower defaults the lender risks the capital. The legal expenses are high. The other problem is diversification, you have to be very loaded to commit such capital to one or several borrowers. The return within a mortgage corporation here is about 8-8.5% with substantial risk, more diversification and less legal expenses. But at 8% one can just buy into high yield market.
Probably you know better the borrowers, so you are a better investor, congratulations
He has a collateral. Also it's commercial, higher risks and expenses.
The financial institution usually monitors the transactions...
If the debtors default the financial institution is going to sell his collateral unless he can make principal or interest and principal payments; good luck for him...
I have been sticking money into my AFP for a few years and wish I had put in a lot more. As it stands now, I've gotten almost 50% on the money I've put away.
It reminds me of when I had CD's with Banco Central at 50% many years ago.
If you think it's love try not paying in the morning..
"Do not regret growing older. It is a privilege denied to many."
Whenever any money guy or situation guarantees you 10% or better returns for 5-10 years and is safe....run for the hills...
If that were easy everyone would do it....
Think Bernie Madoff
Think that Domincan Hustler
Just watch Americna Greed on CNBC....so many people get taken....
I've only done a few second position mortgages,small ones in the $50K range,presently all of my mortgages are first position. I do my lending business in Canada,in Canada we don't foreclose on people that default we go Power of Sale. I only loan up to 70% loan to value with most loans being in the 60ish range,therefore the real estate market would have to crash significantly in less than 12 months in order for my capital to be at risk,keep in mind these are 1 year interest only loans. I prefer that the borrower default at some point and about 50% do,I make a lot more money when people pay me late and eventually default. I charge $250. for every late payment and a three month penalty on a default. Questner,private mortgage lenders NEVER pay the legal fees,NEVER,the borrower pays all legal fees and expenses. If anyone on this forum wants to see the loan documents to a few of my mortgages PM me an email address and I will send them to you as proof. If you people would just do your homework before calling me a liar you just might learn something,private mortgage lending is quite common and people make good money doing it,just because you don't do it and don't know shit about it doesn't mean other people don't make really good money doing it.
Hunter most of the time you are right,if someone pitches an investment idea with high returns it is usually too good to be true,I did nothing of the sort,I didn't pitch anything,I just responded to Questner's plea to be told how to make returns at the rate that I posted that I was getting,I have ZERO to gain from it and have pretty much been called a liar. I can prove that I am not full of shit and am willing to prove it. I will gladly meet with you (or anyone else for that matter) with my loan documents in hand along with my bank statements showing the deposits along with my identification to show proof that the documents are in fact mine. I will be in northeast Connecticut until September 14th,Sosua from September 14th until mid November then back to C.T. until New Year's then Sosua until May. If there is anything else I can do to prove that I am not full of shit just let me know.
The proof is in the pudding. Here's my statement for this month. (In pesos, obviously)
I've had various CD's over the years ranging from 52% down to 18% annual returns.
FWIW, a LOT of people here have lived on the interests from CD's. My last CD paid my house payment for 5 years.
my one lender does exactly what quietcorner is doing and he gets $3500 A YEAR finders fee for the renewal and only gives out a 1 year mortgage.
most people think in a years time they can go get a better deal but cant so they renew again.
my other customer does 5 year terms but gets a 5% finders fee......... for his own money
and yes the customer always pays the legal bills and the appraisal fee from a list they supply
i am in the wrong business......... oh well i am surviving
I am the pussy licker Let's have some fun. Not invisible. Snitches are pathetic little people!
Disclaimer. This post may not be in response to a post by Greybaby. So Greybaby doesn't need to cry about it. Rover has you pegged to a T
I'm still "Just A Lurker."
The Chinese virus infected the Western world with Chinese-style totalitarian politics. - Gladiator
The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary. – H. L. Mencken
I have a client who is a used car dealer. They are actually pretty good guys.
They used to do alot of buy here pay her in house financing for their customers who could not get a conventional loan. It was a major pain in the ass since there is normally a reason those people have bad credit and normally it's because they don't pay.
A few years ago they switched to a credit acceptance company (CAC) for those hard to finance people. Works out great for them since they still make their normal margin up front and the CAC takes care of collecting as well as repos when they don't pay and the car dealer doesn't end up being the bad guy when they car gets repo
It's a lousy deal for the customer since they pay a pretty bad interest rate but at least they have the opportunity to get a vehicle that they normally would not be able to get
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