The Do s And Don ts Of Private Lending
Below is a MRR and PLR article in category Finance -> subcategory Wealth Building.
The Do's and Don'ts of Private Lending
Summary
I've recently received several similar questions via email about private lending, so I've decided to address them collectively. Here, I outline crucial do's and don'ts. Avoid advertising on platforms like Craigslist and using words like "Guarantee." Instead, focus on effective marketing techniques. Let’s dive into the details.
Don'ts
Avoid Craigslist Advertising
I strongly advise against advertising on Craigslist. It's a public platform, and both state and federal authorities monitor it for potential securities rule violations. Advertising on a national scale, including on your own website, can bring you unwanted attention from securities regulators as it may be considered a public securities offering.
From personal experience, someone once responded to my Craigslist ad about my investment program. After a few email exchanges, they seemed interested and I directed them to my title company. They disappeared, but shortly after, I received a "cease and desist" letter from the Pennsylvania Securities and Exchange with quotes from our emails. I wasn't fined but was warned to stop advertising on Craigslist or my website. I've complied ever since.
Avoid Using the Word "Guarantee"
Never use or imply the word "guarantee" in your advertising. Doing so can attract unwanted attention. While it's accurate to say investments are secured by real estate, avoid suggesting a guarantee.
Do's
Host Weekly Breakfast Meetings
Organize a breakfast meeting each week with someone who has extra cash and might be interested in your lending program. Not everyone will invest, but it only takes a few to sustain a real estate buying business. During these meetings, ask for referrals to others who might be interested.
Distribute Business Cards Regularly
Hand out 5 to 10 business cards weekly to build a strong prospect list. These contacts could become future breakfast or group meeting attendees. Don’t dismiss potential lenders based on assumptions. You might be surprised who could become a valuable client.
By following these guidelines, you'll navigate the world of private lending more effectively and safely, attracting the right kind of attention and avoiding pitfalls.
You can find the original non-AI version of this article here: The Do s And Don ts Of Private Lending.
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