3 “Vital” Keys to Getting Millions in Private Money For Real Estate

Do you have a great deal under contract but lack financing?

Is finding money for your deals the biggest problem area for you as an investor?

It was for me when I got started.

I focused so much time getting my first deal under contract that I didn’t stop to think what I would do when I got it. After struggling to finance real estate deal after deal, I decided to learn how to recruit private money. I wanted to know that I not only had a private lender waiting for my next deal, but that I had an affordable way to finance it.

After spending years developing my list of investors and raising millions of dollars in cash, I have discovered that there are 3 “Vital” Keys to having all the money you’ll ever need for your real estate investing deals.

“Must Know” Key # 1: Plant Seeds!

That’s the most important thing that you can start doing right now! Every person that knows that you are an investor and that knows about your investment program, whether or not they are in a position to invest, is one more seed planted in the soil.

Here are a few examples of planting seeds:

  • Just flat out tell someone
  • Send out some form of direct mail letting people know about your program
  • Put an ad on Craigslist
  • Put an ad in the newspaper
  • Put a link on your website describing your program

Any form of getting the word out about your investment program is “planting a seed”.

Over the first couple years of recruiting money, on average, it took around 4 months to get someone to invest with us after first mentioning our program and planting the seed.

Soooo be patient! (this is the reason most of you don’t have enough private financing… you don’t stick with it long enough… remember, these people are putting their hard earned money in your trust and need to get to know you before they just write you a huge check)

There are two types of people most likely to give you money:

  1. People that know and trust you
  2. People that know a good deal when they see one

Keep this in mind when making your list of people to contact for funding for your real estate deals.

Once you gain some momentum and have investor clients that have experience in your program, go for the third type of people most likely to invest with you. And they are the best there is….


After a couple years of working with private money lenders, I didn’t have to go out and seek additional clients.  They just came to me.

“Must Know” Key # 2 : Ask Good Questions!

Your job, when meeting with a potential investor, is to “sell” the idea of investing in your program.

In order to sell that idea, you must ask good questions! Asking good questions consist of two types of questions:

  1. Questions about the past
  2. Questions about the future

Questions about the past will tell you what kinds of investments someone has taken part in, what rate of return they are accustomed to getting, how previous investments have been structured and the results of their investing experience. This can tell you so much about how to set up an investment that works for them and that goes with their investment strategy.

Questions about the future will be more centered on their future goals. These questions will elicit whether they are looking for long or short term investment opportunities, if income is important to them and so on.

By asking good questions, you can give them what they want.   And if you are able to give them what they want, they will invest with you!  Bottom line.

“Must Know” Key # 3 : Structure the deal so that it works for you!

Just because you can get a deal financed doesn’t mean you should go through with it.

It has to make sense for you the investor.  This is where the “creative” in creative real estate investing gets its name.  There are limitless ways to structure an investment loan.

When structuring a real estate investment loan, it all starts by asking, “What’s my Exit Strategy?

Your exit strategy will ultimately determine the ideal structure for your private money loan.

There are two basic pay structures to an investment loan:

  1. Rate
  2. Profit Splitting

Whether you choose to pay a nominal rate or split profits with your investor, the easiest money on you would be…

No payments, loan is repaid when the property sells.”

Setting up an investor loan like that will put you in the driver seat. If you plan to hold the property for some time, it may make more sense to make regular interest payments to your investor.

Those are 3 vital keys to getting millions in Private Money for your real estate investing deals.  Of course, this isn’t meant to be a comprehensive tutorial…. it’s an excellent primer to get yourself off on the right foot.

Who Else Wants Cheap Private Money For Your Real Estate Deals?

That’s a silly question huh? What real estate investor doesn’t want more private money for their deals?

Well… we’re (Patrick and The REI Brain) putting on a 100% content ONLY webinar where Patrick will lay out his entire process for finding, getting, and securing enough private money for your real estate deals that you’ll never have to worry about financing for your deals again.

How’s that sound?

NOTE: Patrick has been a full-time investor for 6 years and just started to chronicle his real estate knowledge over at his blog at www.mustknowinvesting.com .  Check it out and tell him hi for us!


To learn more about the upcoming Getting Private Money Free Webinar (just so you know… it’s FREE and absolutely no product pitches) by joining our newsletter in the form in the upper right of this page.  This is the new revolution in real estate education.  Real life investors teaching the stuff they do day in and day out… no guru’s here.

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About Patrick Riddle

Patrick Riddle has done over 100 deals since he started investing just over 5 years ago. He is considered an expert in creative real estate investing techniques, lease options, short sales, and recruiting private money. He has risen over $6,000,000 in cash from private investors for his company over his 6 years (that's over $1 million a year in private money!). Being a teacher at heart, he enjoys writing for his blog, www.MustKnowInvesting.com, The “Best Darn” Creative Real Estate Investing Blog on the Planet.


  1. 3 “Vital” Keys to Getting Millions in Private Money for Real Estate | - July 18, 2008

    […] out my article, “3 “Vital” Keys to Getting Millions in Private Money for Real Estate.” It’s posted over at theREIbrain. If you haven’t checked out theREIbrain before, […]

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