When we have isolated a home well under market value, we give our private lenders the opportunity to fund the purchase and rehab of that property, Lenders can earn high interest rates – generally 4 to 5 times the rates you can get on Bank CDs or other traditional investment plans.

Your loan is used to purchase the property requiring renovation. The cost will be allocated to the purchase price, renovation costs, and costs to market or sell the property (professional staging and photography). We usually include a small contingency for unexpected expenses.

From our experience, homes that are professionally staged and marketed with professional photography will sell for a higher price than homes that are not and sell faster. Our focus is to maximize the ROI and to minimize the time a finished home is on the market.

There are many reasons, but the primary reasons are time and negotiation leverage. Many of the homes we purchase are in need of a quick closing, sometimes within 10 to 14 days. A traditional bank requires 30 to 45 days to fund a loan. Also, our leverage is far greater when purchasing using cash funds. Many traditional home sales fall out of the contract due to financing issues, and this allows us to negotiate a much lower purchase price and reduce our risk.

Lending institution guidelines are continually changing. New requirements include applications, approvals, junk fees, and strict underwriting guidelines. They also limit the number of investment properties that can be purchased by one company.

We make our profit from the purchase. Your funding allows us to purchase 20 to 50% below retail pricing. That instantly creates thousands of dollars in equity. Our national franchise support affords us the opportunity to purchase materials at 15 to 20% below retail prices. And your funding allows us to save on costs like mortgage broker fees and loan associated fees.

Certainly, and with your loan so are you. With your cash funding we can offer something that very few buyers can. We are buying on their timeline, often closing in 10 to 14 days. When quick closings are important to the seller, our offers can be the difference for a seller. Because we can make “all cash – as is” offers, sellers know they won’t have closing costs or repair costs they often can’t fund. And most sellers appreciate that we are renovating and improving the home they once owned.

This is a great question and valid concern. However, our strategy is not to speculate 3 to 5 years down the road. Our goal is to purchase quickly and sell even faster. Most of our projects are completed within 1 to 2 months of purchase and will be sold within 4 to 5 months of purchase. The market doesn’t tend to shift that dramatically in a matter of months – it’s typically a longer process for an area to decline. That’s why we buy in strategic markets where inventory is already low and demand is high, thus minimizing our risks.

Our rates do vary depending upon the purchase price, renovation expenses, and expected hold time. Most of our loans pay lenders from 8 to 12%. Sometimes points are included on smaller loans to make it worth our lenders’ time and money. Some loans can pay up to 14%.

Although almost all of our short-term loans are set for a 12-month term, most fix & flip loans will usually be paid back within 4 to 6 months. We guarantee 6 months’ interest for our private lenders even when loans may be paid back faster. Again, we want our partnership to be mutually beneficial.

Although we expect to be able to use your funding from purchase to sell, we do know that emergencies sometimes arise. We offer you the ability to request the return of your funding with 30 days notice anytime after 45 days of the property purchase.

You are completely repaid as part of closing, including interest earned on your loan. This is much easier for us to manage. On a longer investment, terms can include monthly interest payments.

No, there is no government-backed guarantee on these privately funded real estate transactions. You are deriving protection from the equity in the property. If at any time we were to default on the agreement, you have the legal right to take the home (essentially foreclose on us).

If this unlikely scenario were to occur, we would simply transfer the property to you if possible. If for any reason we did not or could not transfer the property, then you have all the legal rights of a secured lender. The best way to legally protect yourself in case of a default would be to hire an attorney. They normally would seek to get your investment back, any unpaid interest, any collection costs, all your attorney fees and maybe even more. A legal representative could advise you if it makes sense to foreclose or to seek ownership of the property to protect or recoup your investment.

We do. Midtown purchases a title search and title policy on every investment property. We also purchase Builder’s Risk and Hazard Vacant policies on renovation properties to cover if anything unfortunate were to occur, like a fire. In case of any damages, insurance distributions would be used to rebuild or repair the property, or used to pay you off.

No, we do not pool funding. Your investment will be tied to one piece of property secured by a mortgage that you hold until your loan is repaid.

Yes, you can. Once you’re an approved private lender with Midtown you’ll be able to access lending opportunities through our Investor Portal. You choose the properties that you want to lend on, giving you control of your investments. Wouldn’t it be wonderful if banks allowed us to do that? Further, with our Investor Portal you can see weekly updates on the status of the property as in moves through renovation and marketing stages.

Yes, to be a private lender with Midtown you must meet at least one of the following requirements—

Family/Friends/Known Acquaintance

Accredited Investor of Business Associate

Be Able to Lend a Minimum of $75,000

Referral by a Midtown Private Lender

If you’re ready to begin private lending with Midtown, we’ll start with a conversation getting to know your short-term and long-term goals. We’ll also share our goals and vision with you so that you know the directions we take with real estate investing. Our goal is to always provide a mutually beneficial relationship with our investors. To get started, just click the “Lender Opportunities” button for access to our Investor Portal.