Trust – It is the foundation of the private money world. Private money lenders are trying to find ways to reduce their risk and trust goes a long way when trying to reduce the perceived risk present. While you can create contracts, deeds and notes, all these documents are no good if you aren’t honest and trustworthy.
The question you have to answer is how to build trust with lenders. The good news is, there are several ways you can do this. Learn some of the methods here.
Be Trustworthy
This is simple, but extremely effective. Just do what you say you are going to do and live up to your commitments. Show up to appointments on time, pay your bill and follow through on promises. All this is going to affect the way other people view you, and your trustworthiness. Private lenders are likely going to ask about your character, so make sure you are trustworthy.
Document Your Trustworthiness
If you’re trustworthy you can prove it with documentation. Create a “Banker’s Book” showing your trustworthiness. Also, acquire a copy of your credit report and show how other real estate projects you have taken on were successful. Include a list of references in your book.
Explain Things with Simple and Clear Language
Don’t try to spout all types of real estate and technical terms. Most people won’t understand and may become confused or turned off from the deal. It’s better to keep things simple and explain what you are doing in clear terms. In most cases, lenders only want to know how and when they will get repaid.
Listen to Find Out What Your Lender Wants
Much of what makes a successful real estate investor is listening. Stop to listen to what your potential private lenders have to say. Don’t just focus on your needs. Find out what their goals and needs are to ensure they get something out of the deal, too.
If you want to work with private lenders, be sure to be trustworthy and find out what your lender wants. In the long run, this will help you be more successful.
