Funding
The Only 2 Private Funding Structures I Use
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Hello Moguls! Our good friend and genius REI guy, Patrick Riddle, has gone and done it again. He continues to provide us all with interesting and super-helpful investing info.
We’ve gotten lots of questions about Private Money and specifically, how to structure a deal involving private money…
Have no fear, Patrick is here to answer that riddle (see what I did there with the play on his name?!) and give us the goods. Read on, friends.
How do I Structure Private Money Loans?
I hear from people fairly often who feel a little “fuzzy” on how to best structure their private money (PM) loans. So today I’d like to offer a little helpful insight, using a couple of our students as willful guinea pigs.
The fact is, there are really two PM loan structures that I (and most every investor I know) use regularly: Equity investment or debt investment.
Private Money Structuring – Equity vs. Debt
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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.
Finished?
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