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Real estate investing is turning out to be a profitable business even during an economic slowdown. However, a lot of investors cannot boost their career because they do not have sufficient funds. This is where hard money lenders come into the scene. They are ready to finance good deals and could be the shot in the arm your real estate investing career is waiting for. Here are a few tips for you to find the right hard money lender for you, without the hassles.

Also known as private lenders, they are basically individuals with ready money. So before you go on searching elsewhere, you can try asking your loved ones and friends first. They might know someone who has money and is looking for an opportunity to profit. This system is known as referral and is a good way of finding hard money lenders. If they recommend someone to you, then most likely that lender can be trusted and is a good financier.

You can also ask your neighbors if they know a hard money lender. They could be a lender without you even knowing it. Private lenders are also “discreet” compared to traditional lenders. They usually work at home and do not have promotional signs or offices.

Join local real estate investing clubs. These groups usually have investors, lenders, realtors, buyers, and sellers as members. Sign up for newsletters if they have any. The club publication usually carries the names of lenders and other important contacts.

Scanning the classified ads is another way to find private lenders. Some private lenders advertise their services through the local paper. You might also want to try the “new school” method of searching for these kinds of lenders. You can search online and try typing “rehab hard money,” which means you are looking for financing for a rehabbing project. You can also search “hard money lenders.” Some websites have an online network of lenders, which means you can borrow money whatever your location in the country is.

Whatever method you use, what is important is that you know how hard money financing works. Read articles about the funding first. Visit websites like REIwired.com. The site has a database of videos, sound files, and articles about various real estate investing topics, including hard money financing. It also has a training program for those interested in learning the techniques of the biggest names in real estate investing.

Finding hard money lenders can be a total hassle. Unlike traditional lenders, you will unlikely find huge signs mounted in front of their offices. After all, most of them don’t even have offices. They just “work” at home. You can roam the city the whole day and you might end up with nothing but tired feet in search of them. But if you knew exactly where to look, you can actually find them without leaving you desk. Here are some tips you can follow to find hard money lenders in your area:

You can join a real estate investing club in your area. These clubs have tie ups with realtors and lenders. Clubs also hold monthly or weekly meetings attended by private lenders.  Some rich clubs publish a newsletter that print the names of such lenders and other contacts you might find useful in your real estate investing career.

Another way to find private lenders is to ask for referrals.  Contact friends or relatives who recently brought a property. You can also chat with your neighbor, he might know one. He could even be one. Remember that these types of lenders are basically people who have money and are looking for profit opportunities. Checking the local paper is also another way to find hard money lenders. Some lenders advertise their services on the classified ads section.

The fastest and easiest way to find them is though is online. Go to RehabHardMoney.com and you’re search will be much, much easier. Rehab Hard Money allows users to find hard money lenders closest to their area, anywhere in the country. Borrowers need to accomplish and submit a form online to prequalify for loans wherever you are in the nation. Upon signing up, you will also receive free special reports. One report will teach you to user hard money to your advantage. The other Rehab Hard Money report enumerates five mistakes investors often make when borrowing hard money. You will also get access to a video that teaches how to get and effectively use hard money funding. Rehab Hard Money has a network of lenders across the county, one is surely near your location. Just make sure you double check the state and county you click as this is important.

Whether for rehabbing houses or other forms of real estate investing, hard money remains a preferred form of financing over traditional loans. Find a hard money lender near your area today.

RESPA

For thirty-five years, RESPA has confused people in the real estate industry and attorneys alike. In 1974, Congress enacted RESPA, the Real Estate Settlement Procedures Act primarily to address abusive practices, promote greater understanding to homebuyers and to prohibit practices such as kickbacks or referral fees that result in higher costs.

Efforts began in earnest in 2008 to reform RESPA and on November 17, 2008, HUD published its new 341-page RESPA final rule. Though published in the Federal Register, there is a one year implementation period and mandatory compliance begins January 1, 2010. Now RESPA is about to confuse the real estate industry once again, this time perhaps even more so with respect to its prohibition against kickbacks and fee splitting with questions of how those prohibitions will be enforced.

If you have been the victim of a violation of RESPA in California and have been improperly charged as a result of such a violation, or if you are in the real estate industry and are facing RESPA litigation visit our website at http://www.sebastiangibsonlaw.com and call us at any of the numbers easily found on our website.

RESPA Prohibition of Kickbacks

RESPA was created in the first place partly because various types of entities involved in the purchase and sale of real estate such as Realtors, lenders, construction companies, and title insurance companies were often engaged in providing undisclosed kickbacks to each other, thereby causing the costs of real estate transactions to become inflated.

RESPA was designed to prevent kickbacks not just in California, one of the states with the greatest number of foreclosures in this current economic crisis, but throughout the U.S. But RESPA has been criticized for failing to prevent what it was meant to prevent. Lenders and others in the real estate industry in California, for instance, still see customers go with the default service providers associated with a lender or Realtor, even though the documents the homebuyer signs explicitly state they can choose any service provider they wanted.

However, Section 8 of RESPA quite explicitly and forcefully prohibits a person from giving or accepting a fee, kickback or anything of value for referrals of settlement service businesses relating to a federally regulated mortgage loan. It also prohibits fee-splitting or a person from giving or accepting any part of a charge for services that are not performed.

RESPA Penalties for Kickback Violations

Violations of Section 8’s kickback, referral fee and unearned fee provisions subject a person who violates RESPA to criminal and civil penalties. In criminal cases, a person in violation of Section 8 cam be fined up to $10,000 and imprisoned for up to one year. In a civil lawsuit, a person in violation of Section 8 can be liable to the person who was charged for a settlement service an amount equal to three times the amount of the charge paid by the person for the service, and for the person’s attorneys fees. Individuals have one year to file a complaint to enforce violations of Section 8 in federal court in the district the property is located or where the violation occurred.

Without oversimplifying Section 8, a real estate agent in California or anywhere in the U.S. may not offer nor may a real estate agent accept anything of value for referring business to a settlement provider such as a mortgage banker, mortgage lender or title company or to a friend who refers the agent business. Realtor to Realtor referrals are excluded and there is a contract for such referrals that is enforceable. It is probably still acceptable to take such contacts out to dinner, discuss business and thank them for their support, but that is about as far as one can go.

With all that has happened in the mortgage industry in California and throughout the U.S. that has led to the current economic recession (and some would call it a depression), anyone criticizing the kickback and fee-splitting prohibitions should remember the excesses in lending to unqualified homebuyers that led us to the situation the financial industry now finds itself.

Visit our website at http://www.sebastiangibsonlaw.com and call us if you have been the victim of a violation of RESPA in California and have been improperly charged as a result of such a violation, or if you are in the real estate industry and are facing RESPA litigation.

Entities who are found to have formed sham joint ventures for the purpose of evading the Section 8 prohibitions risk potentially millions of dollars in damages and attorney fees as well as criminal charges and imprisonment.

If you believe you have been the victim of a violation of RESPA in California and have been improperly charged as a result of such a violation, or if you are in the real estate industry and are facing RESPA litigation, we recommend that you consult with our California RESPA law firm immediately.