Hi ,
I am stuck ? , writers block !… I am wishing to approach friends/family for a personal loan and I do not know how to word such a letter ?? …. My partner and I are going to start investing in real estate with the aim of replacing our income with a positively geard property portfolio. We need the personal loan at a competitive rate and on a payment plan that suits both parties , this loan will assist with legal fees and renovation monies to fast track passive income/equity gains.
If someone has done this before , I am looking for a lifline out of this uneducated writers block hole …. if a sample letter is available anywhere on the web / or if you would like to send it too my in box I would appreciate it ![blink] Nathan..
Hi!
Why is it you want to get a personal loan from family and friends?
Are you just starting out in property investing and if so, why not use a bank?Think long and hard about involving family and friends, especially if you are new to this game. If there are problems ahead, your friendships may turn sour. They may think ……
– you are just using them
– they may never see their money again
– they have the right to interfere with your investing decisions
– they can give you their negative opinion about property
– they might change thier mind and want thier money back prontoIf however you have done a few deals, and have a few (3 or 4) investment properties already under your belt, then money makes money and banks will will lend you more than enough to keep going, if they see you can handle it well.
My personal opinion is that if you are new to property investing, do the hard slog and prove to yourself and the bank that you can do it on your own. The 1st one is the hardest.
I created a wealth creation plan and gave it to my bank / broker stating our (my & my hubby’s) plans to borrow approx 1 million to finance positive cashflow investment properties. I stated our income, what we owned and owed and we were on our way with approval to borrow up to half that. You need to take the small steps in order to get to the bigger ones.
Using a broker initially can be a good idea as they want you to get a loan as they get a commission, whereas if you go to a bank. they get a salary and can say yes or no without it affecting their income.
Others may have different ideas, but this was the situation that I could sleep well with, without worrying about my family and friends opinions.
Hope some of that helps!
All the best!
PepsiHey there,
Great ideas!
A Couple of hurdles though.
Banks /lenders like to see proof of savings prior to lending funds.Unless you use a non conforming lender…
So the challenge is to find a private lender for deposits) that will sign a gifting declaration – which is hard to do…(although not impossible) unless you have another agreement signed up in the background like a JV for example. – Give them a share of hte projected returns …. share the wealth and you may get something accross the line.
My 2cents worth anyway.
“Money Follows Management”
Best of luck.KF
These days many lenders will accept borrowed funds to be used as deposit. As long as you can service both loans, then no probs. Also many will not even ask where you deposit is coming from if hte loan is under a certain LVR.
Terryw
Discover Home Loans
Parramatta
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Be careful in asking and involving family and friends (and their dollars). As you are just starting out I think you’ll feel more comfortable and confident after you and your partner prove to yourselves that you can put the hard work in – let’s face it, we have to service these loans for a mighty long time. It may slow down your entry to investing – but if you’re really passionate about it then it won’t discourage you altogether. Steve’s goal setting info is excellent, and can help keep you on the right track. Keep your eye on the big goal, but make sure your smaller goals are achievable.
Just a few ideas
Meeg The Deeg [biggrin]I have just the thing:
…I feel awkward asking you for money. I feel that you have already given me so much would you above, and your emotional support. Through the years, many of you have helped me out…Just remember to replace the words “2004 Dodge Grand Caravan” with “4 Bedroom McMansion in Dullard St” and Bob’s your uncle… and if he’s not, you’d better be hoping he’s not only loaded but also alzheimic…
Here to help, F.[cowboy2]You are sooooo funny Foundation. That letter is a crack up.I don’t know how you’ll go with it Nathan but give it your best shot [thumbsupanim]
Meeg
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