Using private money lenders to finance your real estate deals is an excellent option. In a lot of ways, they’re very similar to hard money lenders but hard money lenders are usually in the business of loaning money to investors whereas private money lenders are just regular ol’ people that have extra cash and are willing to lend it to you. If you are credit deprived or don’t have a sufficient down payment to fund your deal, you may want to start looking for a Private Lender. It’s also a great financing option if you want to flip houses. A private lender could be a friend, family member or a perfect stranger. I love this financing strategy because the terms are flexible. You can negotiate the interest rate, points (if any), and length of the loan. It can be a 6 month loan or a 30 year loan. You can agree to have it amortized over 1 year or 30 years. It’s totally negotiable.
If you plan to just buy and hold a few properties, then you probably don’t need a private lender. However if you are looking to be a serial investor, you should start looking for private money lenders right away.