3 Answers

Colleen

Karma: 2042400

Yes you do unless you want to be a loan shark.

12 years ago. Rating: 0
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pythonlover

Karma: 797301

It seems to me that it all depends on who's money it is. If this is your own private money I don't see any reason why you wouldn't be able to lend it to whomever you chose without a license and as long as you disclose the terms of the loan up-front. If this is investment money that you lend to others, i.e. other people's money, the license requirement would make sense.

12 years ago. Rating: 0
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murphy40

Thank You for you comment.I agree I all of it is my money there would be no problem however this is not the case.
Example
I want to raise private money and loan it out through a third party lender such as a Hard Money Lender(HML). This lender would loan it to say a rehabber. My lawyer, the closing agent, would order the money from the private person and funnel it to the HML.

As an example I would agree to pay my private person with the money say 7% and charge the HML 12% and I would get spread of 5% each month + points up front.

I have been told that so long as the money is not used for the rehabbers personal residence it’s considered a Commercial Loan therefore you do not need a license in any state to do this.
To consider this a Commerical Loan the money would be loaned to a company such as a LLC or Corporation

Your thoughts and comments would be most appreciated.

commented 12 years ago

doolittle