Private Lending by Steve Lawson

“Hello, my friend, this is Steve Lawson, I want to thank you for taking the time to listen in as we talk about a little known world called private lending. What you’re about to discover is a great way to earn high rates of return safely and securely in a way that most folks don’t even know exists. In this audio, I’m bringing you a very special message about how you could greatly increase the value of any investment capital you or your IRA currently has in a CD or money market, or mutual fund, or commodities, or stock market or anything else. This message is about creating wealth, with passive investments secured by real estate for a safe and a very attractive return. Most people try to generate retirement income by following conventional wisdom and letting other people control their money and make the decisions for them. By the time they need the money, they discover, they have barely kept up with inflation, and the cost of living has risen faster than their investments. Now, let me tell you, this audio is not about conventional wisdom. And it’s a fact the super wealthy person who earned his or her wealth does not live by conventional wisdom. If you do things like everyone else, you have to be satisfied with the low returns that following the herd mentality produces. The good news is, you no longer have to accept low rates of return, you receive this audio so you can consider joining forces with me for us to create a mutually beneficial and profitable relationship. With my program, you don’t have to watch the stock market or call your broker or wait for the next crash. My job is to find great deals on properties that may or may not need rehabbing and agree to buy them at cash wholesale prices. With my program, my private lenders can invest their money and earn high rates of return safely and securely, because their investment is always secured with a mortgage on the property. This is a very lucrative investment vehicle for my private lenders for many reasons. First is the safety issue. You see, I don’t allow my private lenders to invest more than 75% of the after repaired value of the property. So in case Steve Lawson loses his mind, you as my private lender are left with a huge amount of equity as a safety cushion. That way, if my private lender had to sell the property, they could quickly recoup their investment and even make a profit on the property. So the very worst thing that could happen is my private lender ends up owning a house at a very deep discount. If that happens, my private lender can hire a realtor to sell it and make more than their interest. Not a bad thing. Next, a high return is very attractive. You see, I pay my investors up to 14 times what they can earn in a CD. And sometimes even more than that. What’s more, they earned this high return. Regardless of what’s happening in the stock market. You can rely on it and not have to worry about the principal fluctuating, the principle remains the same. Now, you may be wondering why anyone would be willing to pay a high rate of return like I do? Well, it’s because the quick availability of funds is more important than paying a lower rate to the bank. Really, I look at my lenders like silent partners, I give them a high, dependable, and safe return secured well buy real estate, and they supply the short term capital to grow my business. It’s a win-win for everybody. Plus, banks require applications extra time to close, extra closing costs., and they have limits as to the number of loans they can make to any one company or one investor. You see I can move much faster without these limitations by using private lenders. As a result, I can to get negotiate more profitable deals, while offering sellers a quick and easy sale. Incidentally, making high interest loans is nothing new. There are companies doing it right now and have been for over 40 years or more. They’re called finance companies or secondary lenders. It’s a multi billion dollar industry. Companies like the Money Store, Coastal Finance, Beneficial Finance, American General are just a few examples. Their specialty is helping people who want to refinance or purchase a home to live in, but can’t qualify for a nice low interest loan. Oh, and by the way, before I get off the subject, just pull out one of those credit card statements and look at that rate. Congratulations. You are also a person like me who’s willing to pay high interest rate for short term money that’s easy to get. And of course, the reason you’re willing to do that is because you’re placing availability of funds above the cost every time you use one of those cards. Like I said, it’s a multi billion dollar industry. So here’s a thought, actually, it’s more than a thought. It’s a reality for many of my lenders. What if we turn the tables on the banks and Grow Rich the same way they have but using other people’s money? Here’s what happens. When banks make a loan, they do it with your money. That’s the money you are allowing to lie around and savings accounts and CDs at low rates that net less than the cost of inflation. You receive a few paltry percentage points while the bank loans your money out at higher rates, they receive the difference, which is referred to as the spread, the spread amounts to billions of dollars monthly. That’s why the banks have the biggest buildings in town. So why don’t you become a bank, if you can borrow money at a low rate, and safely lend it out at a higher rate, you can make a fortune off the spread. Now you’re making money off the bank’s money, don’t you just love it? Incidentally, if you aren’t using your money, you have the best rate of return of all. It’s called infinity. You see, when you have none of your own money invested, you can’t measure the return. I know of one particular private lender who loaned out over a million dollars in one year. And check this out. He borrowed all the money to loan out and charged twice what he was paying, he made over $50,000. net in just one year without putting up a penny of his own money. In fact, he used a credit line, so he wouldn’t have to pay interest while the money wasn’t in use. He made 50 grand using the bank’s money. Well, I’m sure you have other questions concerning private lending swelters, the most common ones right now. First question, can you use your IRA or 401k to make these loans? And the answer is yes, you bet you can. Absolutely. In fact, it’s a great use of them. And what better way to go than tax deferred, or in the case of a Roth IRA tax free. If it’s your IRA, it must be self directed. And this is easy to accomplish, and it’s only a matter of moving it to an administrator of your choice. I recommend equity trust located in Ohio, and I’ve worked with him for many years. Now, the website to get to equity trust is trustetc.com. Again, that’s trustetc.com. Just go on there and explore for yourself. They’ve been around a long time, they have thousands and thousands of IRAs, I think you’re going to find them a pleasure to deal with. Now, don’t worry, this is not a rollover with penalties from the IRS. It’s merely a transfer from your current administrator to another one. If you’re going to use your IRA to make learn loans, you’ll find this is necessary step because most people have their IRAs house with a company that will not allow them to make loans or in fact, do any kind of investments other than what’s on their list. We call those multiple choice IRAs. But not but not truly self directed IRAs. With equity, equity trust, you will be able to do whatever you want with your money, not what someone else insists you do. Now, if you’re using a 401k, you must be in control of your 401k or be able to write a check, you’ll find it difficult to get your employer to direct the pension plan into private loans. They’re usually managed by stockbrokers with sec guidelines, they’ll do what they want, and you won’t change their mind. However, if you’ve left a job or retired, that 401k belongs to you. And by law, your previous employer has to allow you to transfer it to a traditional IRA. In this case, you want to check into transferring it into equity trust. And then you can start making private loans and truly start self directing it. I know several lenders that take the money out of their private plan and shift it into their own self directed IRAs, you might want to consider the same if it applies to your circumstances. And if your company plan doesn’t have a history of high written high rate of return that you’re happy with. Second question, Is this a security or a mortgage pool? The answer is yes. And no. Technically, any debt instrument is a security. But it’s not a security that you’re going to be licensed for or have to register with the SEC or anything like that. You will own the whole loan with no other participants. So there is no pooling, you’re in control all the way, which in itself makes this a better investment than any other vehicle that I know. Only when loans are pooled, does it become a security. When I find a house, I know what it takes to get the job done. If I need to borrow more than I have available more than you have available, then I’ll have another private lender come to the table. Or in some cases, I can fund the deals with more than one investor by simply giving one investor a first mortgage and the other a second mortgage, two separate loans, but secured by the same property. Of course, the second mortgage holder will know it’s a second mortgage and will be willing to accept the inferior position in exchange for an even higher rate of return than the first mortgage. But frankly, it shouldn’t matter as long as the total loan value doesn’t exceed 75% of the after repaired value. For example, if the property’s value is 100,000 and I need to borrow 75,000, I can split the loan into a $50,000 first mortgage and a $25,000 second mortgage. Both loans are still well secured because the total loan to value ratio doesn’t exceed 75%. Third question, who handles the paperwork? Well, it won’t be mean it won’t be you. You should never write a check to directly to me or my company. All real estate closings should be done by a real estate attorney or a title company or escrow company, it depends on the state, your check will be made up directly to that closing agent for the gross amount of the loan, all closing costs will be paid by me. And this is a standard procedure just like any other loan done from anywhere, regardless of who the lender is. It then becomes the Real Estate Attorneys responsibility to receive your funds and make sure that all the documents are in place to secure your investment. You don’t do any paperwork, you simply agree to make the loan and get the money to the real estate attorney when it’s time. Next question, how am I protected against fire loss and making sure the title is clear blanes? The answer? First of all, I purchased title insurance as part of the closing costs on all purchases all purchases to ensure we have a clear and clean deed. And it will be issued naming you the lender as the insured. This protects you against title defects, which could affect your collateral. Plus I purchased fire insurance as part of the closing costs. I want the insurance company naming you the lender right on the policy. So if the house burns down, you get a check for the full amount of your loan. Now when you receive your package after the closing, it will contain the original note and a copy of the mortgage, which will be recorded at the courthouse. Again, the real estate attorney represents you and makes all this easy for you and ensures proper execution. Next question, Is this a long term investment? Well, that’s up to you and me. Most loans are interest only and range from two years to five years with a balloon at the end. However, this can be arranged any way you want it arranged, it comes down to whatever it takes to meet your investment needs and your investment plan. Of course, the longer the money stays out at a higher rate of return, the faster it’s going to grow. If it’s interest only you’re earning interest on the entire principal all the time. If you get a little piece of principal each month on an amortized loan, that little piece is no longer receiving a higher rate of return. So most of my private lenders like to keep the money out and collect interest only or have it accrue interest. Next question is making private loans really a safe investment. If you apply common sense and don’t break the rules I have in place to protect you. It’s a safe is any other high yield investment and a whole lot safer than most. In fact, in my opinion, it’s a lot safer than the stock market. Think about it with stocks, you’re betting on companies, you know little about and the volatility of the stock market is out of your control. You can do well one year and get wiped out the next every day, you’re wondering whether you’re gaining or losing. And the only choice you get to make is when to buy when to sell. Now that’s risky. I don’t care how good you are. The fact remains, you don’t get to make the rules in the stock market. Your investment is at the mercy of ever changing circumstances. Now compare that to private mortgage loans. With mortgage loans, your return is fixed and will change regardless of whether the stock market is up down or sideways. While the stock market spirals downward, other investors are jumping into the windows. But you’ll be smiling because today’s fickle circumstances didn’t affect your money. Your loans are secured by real estate that you can see. And they aren’t going anywhere. Regardless of what the stock market does. You have a large hedge factor to protect yourself if things don’t go as planned. You get to make the rules not be a slave to someone else’s rules. The term rate and conditions are what you and I say they are. There’s no guesswork as to what’s going to happen. You and I will be building our business relationship that could lead to other lucrative opportunities or joint ventures. You see, when people like us build wealth together and prosper from each other’s efforts. It sometimes even leads to other opportunities. I don’t know of any other investment opportunity that gives the safety stability and high return that private lending offers. I want to thank you for taking the time to listen and learn about private lending as a potential private lender. I’m sure you may have some questions that I’ll be glad to answer for you. Just get back in touch with me and I’ll get all your questions answered. Until we talk again, I’m wishing you a very profitable future becoming Steve Lawson’s next private lender.”