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As expected, you will have questions. Hopefully we can answer them here. If you do not find the answer you are looking for please email us at: Derek@FaithfulHomeBuying.com.

01

What’s the minimum investment?

 

The minimum investment is $50,000.

Who handles all of the details?

 

We will. It’s our job to get you proper documentation and protect your interest. All of this costs you nothing. The borrower pays all costs. If you make a $100,000 loan, you send a check for $100,000 to the closing attorney and you get a mortgage for $100,000.

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How do I get paid?

 

We will set up your account. Just sit back and we will send you a quarterly interest only check for the duration of your investment. Our short term investors receive a one time, principle plus interest payment after the full completion of a project. For accounting reasons, this is the preferred way for our company.

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02

03

Is this a long-term investment?

 

Generally, your investment is tied to a specific project with a timeline ranging from 4 to 12 months. We have lending programs for short term holds like these. We also have longer term holds of one year and longer. You can pick a term that suits your strategy. It’s your money and it’s your choice.

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04

05

What if I need to liquidate?

 

If you want out, a 45 day written notice is required, because we will need to replace your funds with another investor’s money. You really shouldn’t make mortgage loans if you feel you will liquidate this shortly, but the option is always available as long as your funds are not currently being used for a purchase or rehab. Also, unlike with a bank CD, there is no penalty for early withdrawal as long as we can get your money replaced by another investor. Just call us, and we will handle all of the details.

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06

Who Borrows at High Rates and Why?

 

Investors like us do, because we have learned in our business that it’s not the cost of money that matters, but quick access to the funds so we can capitalize on opportunities.

 

Our company can acquire good deals in properties because we can act with lightning speed and can close with cash.  Private loans give us this competitive advantage over other investors who take weeks to go through the bank approval process in order to purchase properties.

 

Additionally, if a real estate investor locates a good deal on a property, many times the bank wants to loan on the purchase price not the value of the house, thus penalizing the investor for finding a great deal. Having access to money is generally a deciding factor in investing in real estate, so paying a higher interest rate is irrelevant when compared with the risk of losing the deal.

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07

Is my investment really as safe as it sounds?

 

Yes! We always follow these common sense guidelines that we’ve talked about. Your money will grow two, three, or even four times faster than your current investments and you maintain control.

 

Each one of our properties that we acquire is put through a rigorous financial evaluation in order to evaluate the profitability before the property is ever purchased. 

 

Remember that making loans is a business and should be treated like a business. If you set up a simple system and let the professionals implement the system, your loan portfolio can be hassle free and produce staggering yields. 

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08

How do I use my IRA’s or pension plan?

 

Making real estate loans is a widely accepted use for IRA’s and other Retirement Plans. Most people do not know that you can make private mortgage loans using the funds which are already in your IRA’s and other retirement plans. Think of the power of loaning out funds at high interest rates that are Tax free or Tax Deferred!

 

In order for you to use retirement accounts for loans they must first be administered by a third party custodian. One custodian we commonly work with is Equity Trust Company. You can visit them on the web at www.trustetc.com or simply talk to us and we’ll help you with the set up of your account.

 

After selecting your custodian, you simply send a transfer form to them and they’ll do all of the work for you. Once you’ve done that you are ready to make private mortgage loans.

 

From there, you simply notify your custodian about the investment you are looking to make and send the check for the gross amount of the loan. Even better, we can do all the work for you and you just sign few documents, sit back, relax and wait for your money to grow tax free or deferred like grass on a spring morning. 

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09

What are my options if Faithful Home Buying doesn’t pay?

 

Actually, there are several options but first and foremost, please be aware that “Integrity” is an essential part of our business and we only make sound investment decisions.  One of Faithful Home Buying’s distinguishing features is that we have never been late on a payment to a private lender.

 

Additionally, our company’s policy is to invest our own funds into every one of our projects because if we aren’t confident in our investment decisions why should you be?  Likewise, if we ever lose the support of investors, we can no longer operate our business and our own investments would be at stake. 

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However, to answer the question:

 

  • We could restructure the payment schedule on the note. For example, let’s say we are behind on payments to you. Now Faithful Home Buying can and would like to keep the house, but they can’t come up with enough money to bring you current in one lump sum.  You could let us continue to make regular payments and make an extra payment on our arrearage in addition, or you could simply add the arrearage to the principal balance and extend the term of the loan. This means you would be collecting interest on interest for the entire remainder of the loan. There are always ways to work it out if both sides are willing.

 

  • Have Faithful Home Buying deed you the house. This is an opportunity for you to get a house at a greatly discounted price. When this happens, you can create tremendous profit by reselling the house.

 

  • If left with no other choice, you can simply foreclose. Foreclosure isn’t as time consuming and costly of a process as most people think.      

 

It’s as simple as sending your note and mortgage to an attorney and saying ‘foreclose’. All you have to do then is sit back and wait. Nine times out of ten, before foreclosure is complete, someone will be calling your attorney’s office with a payoff letter, and your loan will get paid off. When this happens, you will collect all accrued interest, your principal balance, and all attorneys’ fees, court costs, and all other expenses you have incurred in connection with your loan.

 

If you wind up with the house that doesn’t mean you have to keep it. It can be sold immediately at a fair sale price and still produce a profit over and above the already high yield on your loan.

 

Now, we’ve talked extensively about default and maybe we’ve provided more information than is necessary, but we wanted to make sure you have all the facts and we’ve answered any potential questions. 

 

10

What kind of documents should I as the lender receive?

 

Your closing package should contain the following:

 

  • A copy of the mortgage. The original will be recorded.

  • An original Promissory Note.

  • A hazard insurance endorsement naming you as mortgagee.

 

These documents provide you with the security you need and the return which you desire.

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