Private lender solicitation

I am looking for private investors and would like to advertise in the local newspaper. I know other investors have done this, but I have also been told that security laws prohibit this. Is this illegal? Are there other ways to find private investor money?

Just don’t advertise a “guaranteed” return. That will get you into trouble!

So to state that I will pay a 12% return on an investment will cause a problem? Or if I use the word “guarantee” will cause me grief?

I am always looking for private investors. You definatly have to know what you are doing. Especially so the investor doesnt run into problems. I am in NJ and we have more laons than we can find money for. There are banks we can go to with some of these loans but our loan is more client friendly. I wish i knew where to find more investors.

Where have you been looking for your private investors? I think the investor can be protected in a number of ways to make it more attractive and secure. The biggest problem I see is you cant pool the investor money together, then I think you are looking at regulatory issues.
We currently use mortgage companies, Hard Money Lenders and private investors but would like to change the ratio. It would allow me to react to deals more quickly and I wouldnt have to turn deals away.

Well the first problem is finding the investors. I am in NJ and with loan amounts of 150 - 200k money doesnt go very far. Also when we do find someone who is new to this they are hesitant to lend someone who has bed credit large sums of money. They have a hard time getting past the credit and seeing they have security in the value of the property.

I don’t believe that Credit is the issue. I believe that you are using that as an excuse because if you really really believe that you will find the money you WILL. Plus, if the deal has a great LTV of under 80% you will find that money will just fly your way.

Have a PARADIGM SHIFT about now. ;D