Association of Private Lenders is now;

American Association of Private Lenders
When we talk about being a “Private Money Investor”, we are talking about someone who loans money to another person at an above bank interest rate while the loan is secured by real estate.

The money can be loaned either short term or long term to professional real estate investors to buy and repair real estate that is then rented out or sold for a profit.
Although a Private Money Investor does not have a physical “bank,” he acts like a bank. He qualifies a borrower and a project and provides the funds, receiving an interest rate of return.

And like a white shirt banker, Private Money Investors are uniquely positioned to leverage the efforts and time of others who are burdened by the daily hassles of a real estate project or property. In other words, they never put on a set of work gloves.

Private Money Investors do not do any of the work of:
• Finding properties
• Rehabbing or maintenance
• Answering tenant complaints

How different this is from the hard work of being a rehabber or a landlord. They leverage the efforts and time of others. You could say that they have figured out a way to work smarter not harder.

Instead of flipping properties, rehabbing, land lording, buying REOs, buying short sale properties, or any of the many ways of doing real estate today, they leverage the knowledge, skills, and experience of professional real estate investors in these niche areas. The only thing they must know is how to be a Private Money Investor. All these real estate professionals have worked hard to know the specific techniques of their specialty. But the Private Money Investor just leverages their expertise by allowing them to use his money.

Often it takes only a few phone calls to get involved in a project and then they wait for the final funds to be wired to one’s bank account upon the project’s completion or on a monthly basis if one has invested in a buy and hold property.

And if the borrower does not pay, the property can be repossessed. Remember, you are a lender. Lenders have the right to foreclose.

The Association of Private Lenders exists to show you how to protect yourself so that if the worst case scenario does happen, and you have to take the house, you will be able to sell it immediately and still make a profit.

We will show you how you can do as many as 24 loans a year and skyrocket the value of your net worth by speeding up the velocity of your investment gains.
You might wonder why investors need you so much right now.

The fact is, many investors who used to depend on banks for financing have had their credit lines cut, often for no fault of their own. The banks either do not have the money, or are so picky that JP Morgan couldn’t get a loan.

What does that mean for you?
This means that investors are in desperate need of your funds and are willing to pay you interest rates often in the double digits.

by Michael Blank on January 7, 2014
biggerpockets.com


I’ve been writing about buying apartment buildings with money from private individuals. In a response to my last article “The # 1 Secret to Raising Money to Invest in Apartment Buildings” another BiggerPockets member asked “how do you find local investors that are interested in discussing deals?”.

Great question, let’s talk about it!
For several years before getting involved with investing in apartment buildings, I was renovating houses, fixing them up and reselling them. To finance these “rehabs”, I raised the money from friends and family. The minimum investment was $25,000 and paid I them 12% to 15% simple interest, guaranteed by the house. The title companies took care of the promissory note and recording the deed. As I was eyeing commercial real estate, I polled my existing investors to see which ones were interested in buy-and-hold commercial real estate.

I was disappointed to find that only a few of my existing investors were interested. However, I found that people I knew were able to refer me to people who were interested.

The lesson here is not that you should start small first (with rehabbing houses, for example) before moving into commercial real estate. Rather, the lesson is that you should leverage your existing sphere of influence to achieve what you’re looking for – in this case, to raise money for apartment buildings or doing flips.

In short, the lesson (which was also confirmed in a recent Podcast with Mike Simmons, ) is to talk to everyone you know.

But how?
It’s surprising who your family, friends, neighbors and co-workers know. Never discount anyone – tell everyone you know what you want to do and you will be surprised at what will happen. If someone refers you to someone they know, always follow up. Even if that person will not invest, she may invest later or she may be able to refer you to someone else.

The conversation might go like this after you dispense with the small talk:

You: “I’m working on something new, maybe you can help.”

Susan: “Oh?”

You: “I’m looking to buy an apartment building in the metro area with a group of investors. The annual returns are expected to be around 13% and the minimum investment is $50,000. You wouldn’t happen to know anyone who might be interested, would you?”

Susan might say, “Well, I might be interested,” or she might refer you to someone, or she might say that she doesn’t know anyone.

If she is interested herself, schedule a meeting with her. If she knows someone, have her make an introduction and then follow up with that person. Make sure you keep Susan informed about the progress.

Your goal is to have as many in-person meetings with potential investors as possible.

Keep these tips in mind:

• It’s important that when you invite someone to that first meeting that you say what the minimum investment amount is. Otherwise, if you’re looking for a minimum $50,000 and the person only has $10,000 to invest, you’re wasting everyone’s time. By the same token, if the other person accepts the meeting, then they’re implicitly saying that they are capable of and potentially interested in investing at that level.
• Don’t “discriminate”. Often it’s impossible to tell who has money and who doesn’t. It’s amazing how much “little old ladies” have stashed away in their IRA accounts. Similarly amazing is how little money the flamboyant stock broker neighbor next door has to invest in anything besides his boat and second house.

Therefore, “EVERYONE” is the key: Talk to everyone, ask everyone for a referral, and follow up with everyone.

If you talk with everyone you know today, and follow up with referrals, you will be amazed at how much money you’ll be able to raise to invest in apartment buildings.

Les Christie
money.cnn.com

Years after the housing market melted down, lenders are lamenting the loss of thin, sleek mortgage application files.

Once easy to carry in one hand, the average mortgage application file has now ballooned to 500 pages, according to David Stevens, CEO of the Mortgage Bankers Association.
"Since the housing bubble burst, file size has grown steadily and dramatically," said Peter Grabel, a loan officer for Luxury Mortgage in Stamford, Conn.

Just seven or eight years ago, the typical application file ran to about a hundred pages, he said. Some for "no-doc" loans were thin indeed, not much more than a credit report, plus an appraisal and property information.

But now files are more jam-packed than ever, with income and asset records, tax returns and other financial documents.

"We now need two years tax returns, two months' bank statements, sourcing of every deposit... on every file," said Grabel.

A middle-income worker financing a median-priced house may get away with just a few hundred pages, but business owners or wealthy people with several income streams can generate paperwork better measured with yardsticks than page numbers.

What gives? After the housing meltdown, tighter rules were put in place, requiring an explosion of disclosures to be included in mortgage applications. Those alone account for nearly 50 pages, said Grabel.

One disclosure even invokes the Patriot Act, the post-9/11 legislation designed to combat terrorists. The Feds require lenders to verify the borrower's identity to make sure they're not suspected of funding or laundering money for terrorist groups.

All this amassing and analyzing of documents costs both time and money. And new mortgage lending rules that are going into effect in January will make it even more complicated.

"New rules require you to triple-check everything," said Jeff Taylor of Digital Risk, a mortgage processing company. "The best thing you as a borrower can do to help yourself is to have all your documentation together before you apply. Get needed items like your credit report and get any errors corrected so you can get through the process as smoothly as possible."

Some of the documentation that's required can seem silly. An applicant may have $1 million in the bank, for example, but if there has been a recent deposit of, say $5,000, he is required to show where that sum came from.

The rationale, explained Grabel, is that Fannie Mae and Freddie Mac frown upon buyers who use loans from friends or family to apply to the downpayment. If borrowers have to repay those private loans, it can make it harder to pay off the mortgage. So every deposit coming into an account has to be accounted for and scrutinized.

The checklist lenders use to manage the application can run three pages long (and is also added to the file). The one Grabel uses has four categories: disclosures, credit package, appraisal package and items needed prior to closing. There are 55 separate boxes to check, covering such items as the good faith estimate, asset statements, and the original appraisal report.

No one ever said borrowing hundreds of thousands of dollars should be easy, but today's requirements are a far cry from the days of the housing boom. "Seven years ago, you signed your name and got your check," said Grabel.

Of course, you can always pay cash instead. That's what Taylor's brother did recently and it certainly simplified the transaction. "There were only three pieces of paper at the closing," said Taylor.

Patrick Morris
www.fool.com


Owning versus renting is an age-old question -- but there are three distinct cases when renting a home makes sense both financially and practically.

The Motley Fool's editorial director, Anand Chokkavelu, outlaid the reasons why you should consider buying before renting in a great article titled "Rent vs. Buy: Why Buying a House Generally Wins," and generally, I agree with his stance. However, there are still some circumstances when renting makes more financial sense than buying.

Young and mobile
Upon graduating college, many Americans want to fully inaugurate their status as adults by buying a home. The reality of a salaried occupation with benefits yields financial freedom and flexibility that was entirely unknown just years -- or perhaps even months -- prior. Dinners of ramen noodles become supplanted by those of Bertolli pasta.

While the allure of buying a home, potentially even with prospect of being able to rent to friends is an appealing one in many ways, it should also be approached with a great deal of caution. Many have estimated that the financial case for buying over renting often only is realized after you've been in a house between three and five years.


Ask many of those considered to be Millennials or Generation Y about the prospect of them being in the same place three years, much less three months, from now, and you'll likely hear something like, "It's possible, but I've always wanted to live in [insert cool urban area], and I'm considering moving there."

And it isn't simply social or societal whims that dictate that decision, but the reality that career opportunities are seemingly always in flux. Consider that a study by Harris Interactive reports that 3 out of every 4 people would consider finding a new job, and a study by Mercer reports that one third of Americans are "actively looking."

While the Census Bureau reports that"U.S. mobility for young adults has fallen to the lowest level in more than 50 years," this is largely because of external economic circumstances more than anything else. It remains true that the lures of new places and new things are strongest for younger generations, and there could be an opportunity cost, like not being able to take a higher-paying job in a new city, and a real cost, like realizing the significant closing costs over a short period of time, if you own a home and sell it just a year or two later.

Fair credit, bad credit or no credit
Depending on current credit circumstances, renting a home may also make a ton of sense. Renting over a period of two or three years could allow someone to build or repair their credit score through a documented history of on-time rent and other payments. The old phrase "time heals all wounds" is certainly true when it comes to credit scores, too.

The reality is a higher credit score will mean a lower interest rate, which can yield monumental financial benefits. The difference in interest payments of a $160,000 mortgage financed at 6% or 4.5% results in a difference of more than $50,000 in total payments over the course of the loan. An even greater impact is realized if those two years allow someone to move to a 15-year mortgage.

If those two additional years allow someone to build up their credit score and secure a lower interest rate, the financial impact can be monumental.

People who love convenience and flexibility
While it cannot be calculated using an Excel model, some people -- whether young or old -- place a premium value on flexibility and convenience.

Whether it's a result of personal or work circumstances, depending on the stage of life that a person finds themselves in, the nuanced realities of owning a home can be daunting. When a pipe breaks, or a window leaks, or the A/C unit stops working, there's only one person (and one wallet) that is responsible for the repairs.

However, when a person rents, that responsibility falls almost exclusively on the landlord. And if you're someone who does not have the ability or desire to ensure that maintenance issues are resolved in a timely and proper manner, then owning a home may not make sense.

Home ownership can be a wildly rewarding endeavor both personally, socially, and financially, yet like anything, it is not without its fair share of work and efforts. For some, those have a cost (that may not necessarily be tangible) and mitigate the recognized financial benefit of owning a home in the long run.

As with most things, there are both reasons when it does, and does not make sense to rent a home, but these are three scenarios when it pays to be a renter.

From renting to investing
Millions of Americans have waited on the sidelines since the market meltdown in 2008 and 2009, too scared to invest and put their money at further risk. Yet those who've stayed out of the market have missed out on huge gains and put their financial futures in jeopardy. In our brand-new special report, "Your Essential Guide to Start Investing Today," The Motley Fool's personal finance experts show you why investing is so important and what you need to do to get started.

From: floridatrend.co

By Richard Roop
richardroop.com


Recent changes in U.S. housing markets and lending industry have created new challenges for real estate investors. But it also creates incredible huge opportunities if you’re willing to make a few adjustments in the type of deals you go after. How you buy and how you sell should be dictated on what’s happening in the market TODAY… not last year or in years gone by.

Let’s look at the proven methods for collecting big checks as a real estate entrepreneur and how targeting sellers who have higher equity can get you more cash now, cash flow each month… and cash later.

Retailing

Retailing in creative real estate is usually based on buying a junker house, fixing it up real nice and then selling it to a qualified cash buyer. In a normal or hot market you can compete with other houses in the same price range because you’re offering a totally remodeled, pristine property.

A rehabber is typically under time pressure to pay off an underlying hard money or investor loan and may not be in a position to offer owner financing. Changes occurring now in the traditional mortgage markets can make relying on a ‘cash out’ buyer more of a challenge.

There are several solutions to this.

First, if you’re in buyer’s market (with some of your competition leaving the game) you can now buy better negotiating lower purchase prices. In turn, you can offer your newly remodeled house at a more attractive price… making it easier to find a buyer.



Next, begin financing your rehab projects with private investors. You can get lower interest rates and a longer repayment term. Then you have the option of selling the property to a tenant buyer or to a contract buyer using wraparound owner financing.

More and more buyers need help financing and by offering the solution you can get a higher price and seller faster.

Finally consider targeting sellers with free and clear houses by offering a very attractive price in exchange for no interest or low interest, long term owner financing. This is easy to do as getting a list of houses with high equity can many times be acquired through public tax and land records.

These sellers must compete in the marketplace just like any other seller. In fact, according to the most recent U.S. census data 1 out of every 3 houses in the nation is free and clear!

Using a small, well-secured private investor first loan you can raise all the cash you need on these deals. Give the seller a down payment if needed, recapture your buy and hold costs, do repairs, pay off existing liens and even put an extra $10,000 or $25,000 in you bank account… on the day you buy.

Marketing Your Home
Written by Joanne Cleaver
Published in: forsalebyowner.com


Appraisals are tripping up as many as a quarter of home purchases these days. Here are top takeaways from the appraisers who reviewed properties for the recently concluded “Is Your House Priced Right?” contest.

• Compare your house only to those of similar age and condition. Neighbors are rehabbing? It gets very complicated very quickly to try to add and subtract value once a house becomes very different from yours. 
• Local preferences rule. Your house doesn’t have central air conditioning…in Florida?  Your condo doesn’t have walk-in closets..in Los Angeles? Local preferences will put your house on the ‘must see’ or ‘never mind’ list for buyers. If you think your appraiser has underestimated the value of certain amenities (Hot tubs in Marin County? Terraces in Manhattan?) request a review of those points.
• ‘Functional obsolescence’ will drive down the value of your house.  What was new and hot 20 years ago isn’t so much any more. If your house has eight bedrooms and most neighboring houses have up to four, you are not going to get much extra value out of the extra bedrooms.
• Overly defined spaces limit value. Adding a separate office adjacent to a new garage is smart. Even smarter is adding a full bathroom. Now the office is self-contained, and could be used as a studio, guest suite or even an in-law suite. The more flexible the space, the higher the appraised value.
• Foreclosures must be counted. Appraisers can’t overlook relevant foreclosure sales just because they are foreclosure sales.  Until foreclosures clear the market, they will be in the mix.
• You are in lockstep with your neighbors. When a neighboring house sells, the parameters for the value of your house narrow. The more recent the sale, the more indicative that sale is of your home’s value. Don’t try to fight it. You won’t win.

Article from: usalendingandrealty.com

The Treasure Coast is attracting a growing number of international real estate buyers, from Canada to Latin America and Western Europe, buying second homes and rental properties.

Helped by a weaker dollar, they are attracted by home values lower than other parts of Florida and their native countries and a less-crowded area. And with rising property values in traditional hubs for foreign buyers, such as Miami-Dade and Broward counties, the Treasure Coast could be the next hot spot for those clients.

The presence of international buyers has been prominent on the Treasure Coast since at least 2008, when the housing market started to decline and the dollar began losing its value compared to foreign currencies. A research published in August by the National Association of Realtors found that Port St. Lucie and Vero Beach rank No. 9 and 13 among top destinations for nonresident foreign buyers in Florida.

The two towns are among the top destinations for Canadians. Port St. Lucie is one of the preferred locations of Venezuelans, Brazilians, other Latin Americans and Western Europeans.

"The Treasure Coast is close to Orlando and Miami and one day it is going to become a great center as well," said Walter Mello, who is from Brazil.

Mello moved to Miami-Dade County in 2008 to manage his aircraft exporting business. He owns cotton, corn and soy bean farms in Brazil and properties in Orlando and Lakeland. He is looking for homes in the area from Stuart to Fort Pierce to escape the traffic of big cities. He also is interested in farmland in Indiantown to raise cattle or fish.

The growth of the Brazilian economy and its middle class, paired with easier access to loans, have caused demand for the country's real estate and prices to soar. Mello said this is the time for Brazilians to sell their properties there and invest in Florida. He's not alone in this thought.

If foreigners choose the Treasure Coast, they should come now, said Donn Wonderling, president of the Realtors Association of St. Lucie County. Home values, in St. Lucie County in particular, are starting to pick up.

"They are not going to find inexpensive houses like years ago," Wonderling said. "They will be surprised that a lot of homes have multiple offers."

According to reports from October, St. Lucie County inventory was down 52 percent compared to October of last year and the median price of a single-family home was up 16.7 percent. That trend is caused mostly by a decrease in foreclosed homes and short sales, Wonderling said.

Martin County home values dropped 6.5 percent, but inventory also was down 41.7 percent. In Indian River County, single-family home prices have risen 27 percent while inventory fell 40 percent.

There are no local numbers that show how much of real estate sales go to international buyers. Across Florida, they represent 19 percent, the National Association of Realtors found. And Wonderling said since he moved to St. Lucie County in 2005 he has seen a growing number of foreigner buyers, in particular Canadians and Europeans.

Traditionally, many Canadians have bought property on the Space Coast and in Broward County, said Sonny Solomon, a broker with the Keyes Company whose clientele is 50 percent Canadian.

"They are doing their homework," Solomon said. "They are not saying, 'I'm going to go to Hollywood (Fla.) because that's where all of my friends are.' They are looking at other options."

Yves Gougoux from Montreal has owned condos in Palm Beach County since the 1990s but picked Vero Beach to build his dream winter home. He purchased an old house in cash and tore it down to build a 5,500-square-foot, two-story home in March.

"Vero is a very nice ocean community with beautiful beaches, nice people, very nice golf courses and I'm really looking forward to spending a lot of time there," he said.

Gougoux, 61, owns an advertising company in Montreal and will spend up to six months in his new house at a time. That is the maximum time foreigners on a tourist visa are allowed to stay in the U.S.

According to the research by the American Realtors Association, if visa regulations were more flexible for foreign homeowners, more international buyers would purchase property in the U.S.

Financing regulations also are stricter for foreigners, the research found, because it is difficult for them to confirm credit worthiness. They do not have Social Security numbers or credit ratings computed on scales similar to U.S. practices. About 82 percent of Florida international buyers use cash.

Despite those hurdles, foreigners see Florida's housing market as advantageous. The U.S. offers more political stability than other countries, and international buyers expect real estate values will appreciate over time.

For Marcel Warmenhoven of the Netherlands, U.S. laws make it easier to screen a tenant's background and to evict them if necessary.

Warmenhoven bought a single-family home at Jensen Beach Golf and Country Club in May and is renting it out. He said he picked Jensen Beach because of low prices and because local tenants plan on settling down for longer than in areas that have a more transient population, such as Miami and Orlando.

The Treasure Coast Global Business Council, anchored by the Realtors Association of St. Lucie County, teaches Realtors in the tri-county area and Palm Beach County how to help foreigners navigate the American real estate system.

The council recently received an award from the National Association of Realtors for its work with international buyers. Only three other councils in the country were recognized — in Miami-Dade and Broward counties and one in California.

Yazcara Bradley, the council's chairwoman starting in 2013, said the fact the Treasure Coast council was recognized along with two South Florida counties known as hubs for international buyers proves the importance of foreigners in the local real estate market.

"More Realtors are interested in catering to them," said Bradley, who is Costa Rican and speaks Spanish and Italian. "In the council, we have people who speak at least 10 languages — French, Hebrew, Russian."

She said a growing number of home sales are to foreign-born clients. Most are naturalized or resident immigrants who have lived in other parts of the U.S. and do not fall under the international buyer designation. Still, Bradley said, they are more comfortable dealing with a real estate agent who speaks their language.

The 2010 U.S. Census showed that the foreign-born population on the Treasure Coast increased from 10 to 13 percent since 2000. Meanwhile, the Hispanic population jumped from 8 to 14 percent. St. Lucie County had the highest increase with 102 percent growth.

New businesses have flourished to cater to that demographics — Cuban and Colombian eateries and Bravo, a Latin grocery store chain, just to name a few.

Local real estate agencies are starting to adapt to that growing diversity by hiring more agents who speak Spanish and other languages. Other Realtors are acquiring necessary accreditation — called certified international property specialist program — to work with international buyers.

That shows the Treasure Coast is becoming more like the rest of South Florida, said Keyes Company broker associate Tom Anton in Port St. Lucie.

"I find Port St. Lucie to be the most eclectic market I've worked in," said Anton, who moved from Maryland 12 years ago. "On my street alone, I can think of six different nationalities. It's a melting pot type of thing."

From LandlordSuccess.com


Anyone who has owned a home has undoubtedly in the past scratched their head in disbelief as to why their homeowner’s insurance premium always seems to increase when policy renewal time comes around. You may also think that your homeowners insurance agent is in your corner when you find yourself in this predicament.

Let’s get one thing straight to start: Your insurance agent does not work for you. They work for themselves and their business which is selling insurance. I have heard more lines of bovine excrement from insurance agents than I can shake a stick at (except, of course, maybe from real estate agents.)

Ok, now that we have that straight…I have a friend who recently bought a single-family home and paid cash for it (not hard in today’s real estate market.) My friend, of course wanted to insure the property against fire, weather and the ever looming threat of a liability (slip and fall) lawsuit. When he received the proposal for the new insurance policy, the replacement cost of the property was roughly double what it would actually cost to rebuild the property from the ground up.

When he inquired with the insurance agent as to why the agent “passed the buck” saying that  they use a company who provides a “replacement cost estimator” calculation based on local construction costs and materials. The insurance agent also mentioned that there is nothing they could do to reduce that amount. For the uninitiated, the replacement cost of a building is usually an amount the whole policy premium is based on. Most of the premium line item amounts are simply a percentage of the replacement cost. So by keeping that amount high (and increasing it every year), the insurance agent and insurance provider is assured of higher and higher premiums. I should also mentioned that the agent handed my friend a line of garbage which included the fact that she, the insurance agent, was “in the same boat” and there was nothing she could do about it either, as if that was any consolation. When my friend looked into the company providing the “replacement cost estimator” the company’s main selling point was to “increase the premiums” charged by the insurance agency and “insure a more stable cash flow” for the business. That nugget was stated right on their web site, not hidden in the fine print of a contract. By the way consumers have no choice in the matter either. As in, they can’t demand that the insurance agent use a different company’s “replacement cost estimator.”

Not wanting to play that game, my friend asked the agent about increasing the “hurricane deductible” (windstorm coverage) as a way to reduce the premium. In Florida, the “windstorm portion” of a homeowners insurance policy is a large part of the premium. By doubling the windstorm deductible, the agent was able to reduce the premium by only by about 10%. Typically, in Florida anyway, the windstorm insurance will be used to replace your roof if it’s damaged in a storm. Well, by reducing the policy premium by 10%, my friend’s windstorm deductible was double what it would cost to replace the entire roof.

In the end, my friend opted for a liability only policy and decided to “self insure” the property itself thereby reducing his premium by 75%. Now the reason I call this a “racket” is because my friend owned this property outright, as in, without a mortgage. If he had a mortgage, he would have had no choice BUT to buy full insurance coverage thereby perpetuating this huge money suck. Just lovely, isn’t it?