Investing, loaning your money, to borrowers is an age old practice.   It’s been around since ancient times to modern times.

Your neighbors, your church, your business owners and even your IRA custodian (with your approval) lend their money to others through brokers.

People, companies and even government municipalities have loaned their money to borrowers so they can receive higher earnings than offered else where.  Compare U.S. Treasury Bill rates, bank savings rates, money market accounts, certificates of deposit.  All offer low rates of return compared with private loan rates a private lender can receive from private money brokers.

Rate of return annually is usually from 8% to 10%.  To receive any note rate over 10% per annum a private lender has to have a real estate broker, licensed by the Calif. Department of Real Estate, arrange the loan for you.  You are called the beneficiary (lender) on loan documents.

Omega Capital Management, Inc. usually arranges a loan with 50% maximum loan to (appraised) value on the real estate property.  However a private lender can select a higher loan to value ratio.  Omega Capital Management, Inc. only arranges FIRST loans at this time.

Loan terms are usually from 6 months to 7 years.  We have noticed that the loan actually pays off in one to two years.

If there is more than one lender loaning their money to a borrower on the same loan then a real estate broker licensed by the Calif. Department of Real Estate, or other qualified collection service, must collect the payments and disburse those payments.

Private lending may not be for every body.  The annual yield is high and the risk is high.  Treasury bill, bank certificates of deposit and money market accounts all offer some sort of guarantee along with very limited risks.  You need to consider this.

With private money loans there is a risk that you may have to make payments for other obligations associated with property ownership.  You may loose you money under circumstances.  You have to have money saved in reserve for unknown actions to protect your trust deed investment.

Your transactions should always be transacted with a state of California licensed real estate broker.  You should always transact business with that broker who regularly arranges private real estate loans.  Never with a broker, or agent, who’s never, or seldom, has arranged private loans in the past; never a real estate broker, or mortgage company, who only arranges conventional loans, unless they can demonstrate to you they know the private lending laws.  There is a big difference.

Omega Capital Management, Inc. usually has loans available for you.  Please call George Adair, Sr. for more information.