Private Lending Made Easy
If you’re not earning above average returns, 6%-8% annually, on your investment dollars then you should consider participating in our Private Lending solution.
Houston Directed Capital created the Private Lending opportunity for people who want to help restore communities while at the same time put their funds in a safe, secure investment and earn solid returns.
Invest in private mortgages with us, and earn 6-8% on your money… SAFELY!
So, what is Private Lending?
It is a loan made to a real estate investor that is secured by real estate. Private Loan Investors are given a first or second mortgage that secures their legal interest in the property thus securing their investment.
We often borrow funds from private lenders to purchase, fix and then hold as rentals and on occasion sell residential properties in the Houston housing market. The private mortgages generally have a term from 2 to 5 years.
We are not talking about high Loan-To-Value (LTV) ratios the banks and savings and loan institutions make on homes. We offer very low Loan to Value (LTV) ratios to our Private Lenders to increase the security of the loan. Our standard LTV ratios are under 70% of the value of the property securing the loan and frequently as low as 55% to 65%.
If we are buying a house that would be worth $80,000 after it is completely remodeled, the most we would have a private lender loan on this property would be $56,000. This means additional security on the investment. This is obviously a much safer approach from that taken by conventional lenders. Mortgage companies in the news lately get into trouble because they make loans at an 85%, 90%, or even 100% loan-to-value ratio leaving them with no equity for transfer costs if they are ever forced into a position where they have to take back the collateral property.
You, as a lender, will never lend more than 70% of the repaired value of the home. As a lender, it is in your best interest to minimize risk and maximize return and this is why a loan should never be made without a 30% safety net.
We will NOT violate this rule, because your security is at stake.
The private lender is secured by a first mortgage on the properties we are buying. All closings are handled by a title company, filed with the county clerk and secured with title insurance. Once your mortgage is in place you will receive interest only payments every month for the term of the mortgage. For example if you provide a loan of $45,000 at 10% interest you would receive $450 each month for the term of the loan. At the end of the term you may have an option to renew and earn additional fees or receive the full amount of capital that you originally invested.
We are always buying properties, so if you like the returns, you can continue to lend to us, and we can keep your money at work for as long as you like.
Here are the Steps:
1. Houston Directed Capital Group (HDC) would locate an investment property that would meet their criteria.
2. HDC would offer a Private Note to cover acquisition and remodeling costs, not to exceed 70% of the properties ARV (After Repaired Value).
3. HDC closes the purchase of the property and begins the remodeling process using funds from the Private Lender.
4. Once the remodeling is completed, HDC would manage the property by either leasing, owner financing (with a balloon payment due before the private loan term expires) or facilitating a sale of the property (if the property were to sell quickly, the private investor would receive 3 months of interest and first priority to reinvest their funds on the next available offering).
5. The property is managed by Sherwood Property Managers for cash flow and long term equity appreciation.
6. Upon eventual sale of the property, the Private Lender receives 100% of his/her invested capital back, plus interest as agreed.
7. The Private Investor can then reinvest their capital into another property.
If you have money in the stock market, CD’s, savings accounts, IRA’s, pension plans, or any other investments and you are not getting at least a 6% return, then we should talk.
Please call us to talk more about this opportunity, or simply complete the form at the top of the page. We will respond to all requests for information as quickly as possible.