Mar 06 2010
Private Money Lenders Win With You When They Invest In You
» Escrito en Food, Thoughts, Travel por Admin a las 00:02Private Money Lenders Win With You When They Invest In You
Let’s look at an example of real estate investing with private money, and how everyone wins.
Let’s say you bought a house and fixed it up for a total of $100,000, and you sold it for $150,000, meaning you made a $50,000 profit, and you did it in 4 months.
If you also paid interest at 12% per year (1% per month) on the $100,000 you borrowed, you would pay $4,000 in interest for that 4 month period.
Now, remember, you made $50,000 on the deal. So, subtract the $4,000 in interest cost from your gross profit and youre left with a net profit of $46,000 from your real estate investing. Pretty cool deal isnt it!
Your private money investor is happy because they got 12% on their money, about six times the prevailing bank rates, and their money was secured by the property you bought with the money.
Not only that, but you made $46,000 too! Everyone wins.
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