(NOTE: What it's like to write a $1,000,000 check for a sweet piece of undervalued real estate … even if your bank account is overdrawn and you owe the local lawn boy $20? This special report shows you step-by-step.)
I get dozens of emails every day from people and students asking questions about private money.
So today, yours truly, Patrick Riddle, is going to answer some of the ones I get asked over and over again…
1. What is private money?
Private money is cash that is lent to you (the investor) from an individual, rather than being invested traditionally through stocks, bonds, mutual funds, etc.
Whether it's someone who frequently loans privately to investors like you, or simply a friend or family member with some cash on hand who invests their pile of money in you and your deals – when you think about private money, think investment funds from an individual… any individual.
2. Is private money the same as hard money?
Far from it actually, though they are commonly confused with each other.
Hard money lenders finance deals for real estate investors as a business. Often, they lend to investors based on the property, not necessarily based…
Patrick Riddle
has been investing in real estate ever since he got the bug in college at Clemson University and - to his parents dismay - dropped out of college to dive full-time into real estate at the age of 22 with a couple friends/partners from school.
The first few deals were rough for them, mainly using their own cash, credit, and hard money loans. But, soon he found out that was a rough and unsustainable way to build a real estate business.
After "on the job" learning through the school of hard knocks at first, he found the key that helped their company get deals done more quickly, with higher profit, less risk, without having to go to banks or use their own cash.
Fast forward to today, their company has closed over 130 real estate transactions and has put over $6 million in private money into their own transactions.