{"id":1387,"date":"2007-07-06T12:07:59","date_gmt":"2007-07-06T19:07:59","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=1387"},"modified":"2007-07-05T07:52:47","modified_gmt":"2007-07-05T14:52:47","slug":"hard-money-buy-at-eight-sell-at-twelve-repeat","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/1387\/hard-money-buy-at-eight-sell-at-twelve-repeat\/","title":{"rendered":"HARD MONEY: Buy at Eight. Sell at Twelve. Repeat."},"content":{"rendered":"

Imagine a business with a 50% markup. No employees, no warehouses, some liability, and you can do it from the comfort of your own home. I’m not trying to introduce you to the hottest multi-level marketing craze nor am I trying to convince you to open a franchise.<\/p>\n

I want to talk to you about becoming a buyer and seller of money. Mortgage money. I’m talking about the private mortgage marketplace.
\nLet me start off by showing you how to get the money you need. If you own a home with a bunch of equity (and many of you do), you have a lousy investment<\/strong>. Robert Ashby, President of Solid Rock Mortgage in Florida, tells us that home equity earns you nothing and may actually shrink<\/a> over the next 6 months to 6 years (depending when your local market turns around). If your boss left a bunch of inventory in the warehouse and it was in danger of losing value, he’d be looking for another job in a few years. Turn that “dead” inventory into money producing inventory by borrowing against your home equity. You can do that for about 8%<\/a> in today’s marketplace.<\/p>\n

Disclaimer:<\/strong> The private mortgage as an investment, aka “trust deed” or asset-based lending<\/em> (READ: hard money) is a very specialized market. I talked about this marketplace in<\/em> Life As A Legal Loan Shark<\/a>. I try to refer would be trust deed investors to the<\/em> basics of trust deed investing<\/a> and ultimately send them to the<\/em> California Department of Real Estate explanation<\/a>.<\/p>\n

Now that we have the appropriate disclaimer out of the way, let’s talk about how you make money. Let’s secure you a HELOC for $225,000. We’re going to leave $25,000 in what Jeff Brown refers to as the Sominex account<\/a>. Subprime borrowers are not always the best at paying the loans back in a timely manner so we want to have access to 10-12 months worth of payments in reserves. That way you can weather a storm.<\/p>\n

Now, we’re going to have you Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Imagine a business with a 50% markup. No employees, no warehouses, some liability, and you can do it from the comfort of your own home. I’m not trying to introduce you to the hottest multi-level marketing craze nor am I trying to convince you to open a franchise. I want to talk to you about […]<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[5],"tags":[],"class_list":{"0":"post-1387","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-real-estate","8":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":15383,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/15383\/lower-va-funding-fees-as-of-november-18-2011-attract-year-end-veteran-buyers\/","url_meta":{"origin":1387,"position":0},"title":"Lower VA funding fees, as of November 18, 2011, attract year-end veteran buyers","author":"Brian Brady","date":"November 22, 2011","format":false,"excerpt":"N.B:\u00a0 On the day before I published this, HR 674 passed, reverting the funding fee amounts to the \"old\" levels.\u00a0 It was updated in VA Circular 26-11-19, published November 22, 2011.\u00a0 The \"new\" lower funding fee schedule was in effect for three days, from Nov 18-21.\u00a0 Sorry for the confusion.\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1407,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/1407\/interview-with-robert-ashby-cmps\/","url_meta":{"origin":1387,"position":1},"title":"Interview With Robert Ashby, CMPS","author":"Brian Brady","date":"May 14, 2007","format":false,"excerpt":"I interviewed Robert Ashby, a Certified Mortgage Planning Specialist, in this 15 minute podcast. Robert's background is also in securities sales so he and I have much in common. Robert was the first CMPS in Florida and is President of Solid Rock Mortgage Corporation. He runs a site called Mortgage\u2026","rel":"","context":"In "Interview"","block_context":{"text":"Interview","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/interview\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":18716,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/18716\/why-wont-people-move\/","url_meta":{"origin":1387,"position":2},"title":"Why won’t people move?","author":"Brian Brady","date":"June 8, 2022","format":false,"excerpt":"The housing market is \"stuck\". Higher mortgage rates and the fear of higher property taxes cause Boomers and Millennials to \"hunker down\" rather than move to new homes. Reverse mortgages might offer a solution to this problem. Today,\u00a0 2 out of 3 Baby Boomers are rejecting retirement communities and \"aging\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":10553,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/10553\/the-rates-arent-the-only-thing-that-matters-my-thoughts-on-how-to-create-healing-in-the-housing-market\/","url_meta":{"origin":1387,"position":3},"title":"The Rates Aren’t The Only Thing That Matters….. (My thoughts on how to create healing in the housing market)","author":"Tom Vanderwell","date":"December 14, 2009","format":false,"excerpt":"A couple of thoughts about this article from the New York Times: It\u2019s true.\u00a0\u00a0 Anecdotally, I\u2019d have to say that depending on the day, anywhere from 30-50% of the people who I discuss refinancing with are either not able to do it because their income has fallen or because property\u2026","rel":"","context":"In "Dirty Laundry"","block_context":{"text":"Dirty Laundry","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/dirty-laundry\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/media.cnbc.com\/i\/CNBC\/Sections\/News_And_Analysis\/__Story_Inserts\/graphics\/__REAL_ESTATE\/home_equity.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":2708,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/2708\/the-beat-goes-onand-the-beat-goes-on\/","url_meta":{"origin":1387,"position":4},"title":"The Beat Goes On…and The Beat Goes On","author":"Brian Brady","date":"March 6, 2008","format":false,"excerpt":"The Fed reported that home equity is at its lowest since World War Two: Homeowners' portion of equity slipped to downwardly revised 49.6 percent in the second quarter of 2007, the central bank reported in its quarterly U.S. Flow of Funds Accounts, and declined further to 47.9 percent in the\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":4858,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/4858\/will-mortgage-brokers-be-the-hope-for-homeowners\/","url_meta":{"origin":1387,"position":5},"title":"Will Mortgage Brokers Be the Hope For Homeowners?","author":"Brian Brady","date":"October 8, 2008","format":false,"excerpt":"The FHA Hope For Homeowners program was designed for existing homeowners, struggling with mortgage payments and an \"upside-down\" equity position in their primary residence.\u00a0 It is a new program with lots of misinformation.\u00a0 Some believe it can only be offered by existing loan servicers, some think only participating lender\/servicers can\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/1387","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/comments?post=1387"}],"version-history":[{"count":0,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/1387\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/media?parent=1387"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/categories?post=1387"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/tags?post=1387"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}