One of the common challenges business owners face is finding money to make their first deal or two. That should not be a huge concern. Generally, when the deals are found, the money will follow. However, to bring the money in, we can use the following options to find the money
· FFNDD
Family, Friends, Neighbors, Doctors, DentistsBasically, anyone that you know. Don’t ask for money – just tell them what you are doing. They will either wish you luck or ask to get in on a deal.
· CC
Credit CardsUsing credit cards and cash advances to fund a deal. Beware of interest rates, transfer fees, annual fees, usage fees, and any other type of fee.
· HELOC
Home Equity Line Of Credit
The benefit of using this money is that the interest rate is tax deductible. However, it can put your home at risk or, if you do not own a home, you will not qualify for this type of credit.This type of money can be secured through your bank.
· PLOC
Personal Line Of Credit
If you qualify, this is an ideal method of securing funds for your deals. There is no interest charged until you use the money and you can pay it back as you go. This will always provide several thousands of dollars of readily available cash.This type of money can be secured through your bank.
· HML
Hard Money Lenders
Hard money lenders can provide the funding on a deal by deal basis.
Questions that you need to ask hard money lenders:
1. What interest rate do you charge?
2. Do you charge points, if so how many?
3. How fast can you finance a deal?
4. What is the length or term of loan?
5. Are there any pre payment penalties?
6. What is your LTV (loan to value rate)?
7. Do you expect a monthly payment or end of term balloon payment?
8. Are there any other charges?
Try not to be too specific at first with a hard money lender as some may try to steal deals
· REIC
Real Estate Investment Clubs
This may be a perfect place to find potential investment partners. You will want to call the local clubs and find out if their club would be the appropriate place to find potential real estate investment partners.
· Corporate Credit – During your session with Strategic Financial Services, ask them about obtaining corporate credit.
