Discover few things that make the private loan investment considerably more involved than a bond investment.
-Liquidity
-Collateral Valuation
-Advances
-Title
-Borrower Credit
-Private Lender Insurance-
-Documentation
private lenders also require a large down payment, anywhere from 30% to $40 %.Besides they charge high interest rates(6%-13%).However Private loans are often processed much quicker than mortgages through a traditional lender, and can also be drafted up for whatever duration the two parties agree upon.
Can you differentiate the pros and cons of working with private lenders?
Pros: Fast Closings, Funded Deal, and Profitable to both if executed correctly.
Cons: Just read the first part of Moses O response. Therefore it takes money to make money.