Optimal Finance Daily - Financial Independence and Money Advice 3109: Accidental Hard Money Lending by Joel of 5AM Joel on Real Estate Investing Advice
Apr 15, 2025
Dive into the world of hard money lending as Joel shares his intriguing journey into this investment realm. He offers clear insights on turning passive capital into substantial returns, all while emphasizing the importance of thorough research. Learn the potential risks and rewards, and discover how personal circumstances play a crucial role in aligning your investment strategies. It's a venture that promises slow yet steady growth, debunking any notions of quick riches.
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Joel's Hard Money Lending Experience
- Joel lent $50,000 to his friend Steve for a house flipping project expecting a 15% annual return.
- After nine months, Joel earned $5,625 but found the experience too stressful to repeat.
Evaluate Execution Risk
- Assess the borrower's execution ability carefully, as poor execution is the main risk in house flipping.
- Only invest with experienced partners who have a track record of successful projects.
Perform Thorough Due Diligence
- Always perform due diligence and review all documents before investing.
- Ask questions and verify numbers to protect your investment and avoid surprises.