Posts Tagged ‘online loans’
A private money lender loans out thousands all the way up to millions of dollars every year to both public and private, individuals and businesses. They have no connections to the government in their lending practices and are free from the politics of large lending institutions. licensed money lender They lend for many purposes from student loans to small business loans. Becoming a money lender does require some training and, in some cases, licensing. But it can be a rewarding business for an investor who wants a good return or who is interested in funding various causes.
Some knowledge of brokerage, real estate, bank loans, property management, escrow, etc are necessary before becoming a private money lender. It is easy to get the needed training from online courses. Gain all the knowledge possible in the industry specialization will take place in. There is plenty of specialized information about lending in any area whether it is for film, students, or a favorite cause. Some of these courses even offer licensing with proper completion. Licensing is required in some areas. There are many different requirements for those wishing to become lenders. A good lawyer can assist in making sure all requirements are met. Focus in on the industry that lending will take place in.
Minimize risk in a private money lending business by keeping the amount of money lent fewer than 75% of total LTV. Ensure that loans are secured by collateral or assets. Check to make sure that borrowers are financially solvent. Use systems that verify the credit standing of borrowers. Keeping an attorney on hand is a great way to keep business above board and risks limited. In some places having an attorney on retainer is required by law to be a private lender.
Keep track of interest rates. Offering similar interest rates to banks and other lending institutions will ensure that as a private money lender, rates are competitive and make money. Rates should be checked at least weekly and adjusted accordingly. It is also a good idea to have a separate and professional title and escrow company to handle paperwork and details of lending terms. This can decrease work load and add another level of safety to the process. Follow their progress carefully to ensure that the closing happens in a timely manner. With solid investments and good returns, money lending can be a great way to invest money.