Lending private money is one of the more “passive” ways to make passive income. But sadly, most real estate investors don’t even know that this is an option for them. Private money lending and hard money lending is often thought of as taking money from mega-wealthy individuals or huge industrial lenders. But, a regular investor just like you could start profiting by lending money to investors who need it when you may not.
James Dainard has spent a long time working on flips, rental properties, and new construction deals. But sometimes, he would rather have his money work for him, instead of him working for more money. Private money lending is one of James’ favorite ways to still bring in a good return, without having to deal with the contractor, management, and funding headaches. If you’re thinking about lending private money, just make sure you do a few things that James suggests. These steps could stop you from falling flat on your face the first time you hand out your hard-earned benjamins.
Got any questions about private money lending? If you’ve lent money before, would you do so again? Let us know in the comments below!
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00:00 Bulletproof Passive Income?
00:39 Why Become a Private Lender?
02:00 Better Returns for Less Work
02:41 Vetting Your Borrower
04:27 Legally Protect Your Money
06:13 Before You Lend Private Money