Private Money Investors

You can locate them by placing a small classified ad in your local newspaper. Dont give too many details in the ad, just ask them to call you and state the percentage return you are willing to pay. Typical private money investors expect anywhere from 12-20% annual percentage rate on their money. You also need sufficient collateral.

You also need to understand what kind of risk the private money investor will be taking on. The riskier it is the less likely private money investors would be willing to jump on board. If you can make the situation are low risk as possible for the private money investor and as much of a no-brainer as possible, then you will get all the money you will ever need.

Before you approach any private money investors, you need to be able to think of answers to their objections or questions ahead of time. Questions such as why should I lend you money? What are your plans? Have you done your research? Are you educated and are you capable of pulling this off? Why should I have confidence in you? What are your past accomplishments? The most important question, "How do you plan to repay me? And how long before you fully pay off the loan plus interest? What is the collateral? What happens if you default?"

Another way to find private money investors is to talk to family and friends first. You would be surprised as to who has money locked up in low interest savings accounts and CDs. People that you dont expect to have a lot of money such as maids, janitors, housekeepers, cab drivers, etc. actually might have the money you need. Never judge anyone based on their occupation. A friend of my parents, who is a housekeeper, has 3-4 real estate properties free and clear and just paid $20,000 for his daughters wedding. A lot of blue collar Asians have huge savings tucked away and they are hard workers.

Look for investors that have portfolios of investments, because they are always open to opportunity. If you go to your local chamber of commerce meetings and business tradeshows and conventions you might run into a bunch of private money investors. I have met very wealthy investors in clubs, online, and at conventions.