ROBB KRAUTBAUER

THE

HANDBOOK

PRIVATELENDER'SA PRIMER ON THE SPECIALIZED REAL ESTATE INVESTING TECHNIQUES OF THE WEALTHY

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CONTENTS

Real Wealth Real Estate: 10 Minutes to Low Risk Investment . . . 1

The Stellar Advantages of Real Estate Investing . . . . . . . . . . . . 2

Welcome to Hard Money Made Easy . . . . . . . . . . . . . . . . . . . . . 4

Here’s How it Works . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

So, What Exactly is a Private Hard Money Loan? . . . . . . . . . . . . 8

A Run-Through of the Loan Process . . . . . . . . . . . . . . . . . . . . .11

Short Term High Interest Finance . . . . . . . . . . . . . . . . . . . . . . .13

Safer Investing in Real Estate Today . . . . . . . . . . . . . . . . . . . . .15

Why People Need Hard Money: Community Building . . . . . . .18

Making the Yield: The Goal in Business . . . . . . . . . . . . . . . . . .19

Why is this a Major Opportunity? . . . . . . . . . . . . . . . . . . . . . . .21

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Real Wealth Real Estate

10 MINUTES TOLOW RISK INVESTMENTWhat is the one investment vehicle that nearly all wealthy individuals swear by?

The unequivocal answer is: ‘real estate.’ For holding onto accumulated wealth, or for creating new wealth, there’s simply nothing better for investors.

Real estate billionaires, in fact, make up a significant portion of total billionaires in the world–Sheldon Solow, owner of Manhattan’s 9W 57th tower; Ted Lerner, Washington, DC shopping mall magnate; and leading the pack, of course, is Donald Trump, who trades in real estate.

Even Ray Kroc, founder of McDonalds, was in the real estate game.

There’s a perfectly good reason why so many wealthy people are attracted to real estate and stick with it throughout their wealth-building careers.

For one, real estate is a stable investment in comparison with other investment vehicles, such as the stock market. The stock market will always rise and fall at the whim and emotions of a fickle market. To say the least, it’s much riskier and stressful than most people would like.

The same holds true for mutual funds, commodities, and options.

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THE STELLAR ADVANTAGES OF REAL ESTATE INVESTINGBefore you enter into any investment, ask yourself...

Do I have control over the asset? Can I increase the value of the asset? Is my investment secured? Is my investment insured?

When it comes to stocks, mutual funds, commodities, and options, the answer is NO.

You have no control, no value-add, no security, no insurance.

But with real estate, you have ALL these assurances and benefits.

Do you have control over the asset? Absolutely. Real estate is a HARD ASSET. Your fund manager has the ability to minimize and manage risk…and structure it AWAY from you, the investor.

Can you increase the value of the asset? Yes! You can improve it, rehab it, add amenities, remodel, rebuild, expand, and increase its value and longevity in a myriad of ways.

Is your investment secured? Yes, again. When you lend private hard money to a borrower on a property, you get a secured, recorded lien to protect your interest. And that lien is typically a first position lien, putting you in the driver’s seat should your borrower default.

Is your investment insured? YES! Depending on your investment, you’re insured with either a residential hazard

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insurance policy or a commercial policy. So in worst case scenario, should something devastating happen to the property, your investment is insured.

As you can see, the benefits of investing in real estate far exceed those of the stock and mutual fund markets.

Your real estate investment–when managed correctly and intelligently – has the power to create continuous long-term wealth.

Because of these advantages, it’s not uncommon to find people moving established wealth into real estate to make it more secure, so that they can grow and ‘keep’ what they have.

Right now, I’m going to share with you how investors just like you can enter the real estate investing arena without ever having to buy, sell, manage, or landlord a single property. And without ANY previous experience whatsoever.

You’re going to discover how to earn significant returns on your investment in a short span of time by investing in a Private Hard Money Fund.

And the best part is, there’s nothing complicated about it.

Tremendous investment opportunity resides

within the real estate industry. For wealth generation, nothing

pays off quite as handsomely.

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Welcome toHARD MONEY MADE EASYI think you’ll agree that real estate investing is a goldmine for people ‘in the know.’

While it can take years to orient yourself to certain real estate investing strategies, there are others ways investors can capitalize on this opportunity.

That brings us to hard money, and how easily it bridges this gap.

Hard money, also called ‘private money,’ is a term used to describe loans that are secured by real estate and funded by private individuals or parties. These loans are offered at a much higher interest rate than your average bank.

With hard money, the underwriting guidelines are much less invasive and less time consuming than those offered by banks.

When borrowers actively seek hard money loans, they do so because it’s convenient, easy, and readily available. The borrowers I’m referring to are real estate investors—rehabbers, contractors, operators, and fix and flippers.

The borrower need cash NOW. They must act quickly. They don’t have the time to wade and slog through the lengthy bank approval process. Plus, the chances of a rehabber, operator, or contractor obtaining an investment loan from a traditional bank is very slim.

Which means they’re highly motivated to seek out private hard money lenders.

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They will happily pay a premium for the privilege and convenience of accessing readily available cash to fund their deals and rehabs.

And that makes investing in a private hard money fund VERY attractive to you, a capital provider.

When invested wisely with an experienced fund manager, you can feel confident that your capital is secured, insured, and that you’ll realize strong, healthy returns.

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HERE’S HOW IT WORKSA fund management team handles most of the transaction once a prospective deal presents itself.

• The first thing the fund team sets out to achieve is the discovery of a terrific piece of property with great profit potential. Distressed properties, foreclosures, and major rehabs are excellent sources of opportunity, among others.

A good fund manager focuses on finding these gems to ensure that the property provides excellent returns to you, the investor.

• Once a property is located (either actively or through a borrower who approaches the fund for a loan), the fund team finds qualified, experienced rehabbers to repair and rehabilitate the property. If the borrower is experienced, he or she may already have a crackerjack rehab crew in place.

The team is also proactive in finding a buyer for the property.

The fund manager oversees the project to make sure that the rehab crew and borrower are effectively adding value to the property through improvements to the internal and external aesthetics, as well as to the property’s utility, if needed.

• Once the property is renovated, the borrower sells the property at a premium. At closing, the principal capital comes back to you, the investor, plus the pre-determined interest and fees.

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This short-term investment—typically 6 months to a year–results in great profits for the investor and the fund management team. Investors can be assured that the interests of the management team and investor are aligned in these deals because both parties are incentivized by the success of the purchase, rehab, and sale of the property.

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So, What Exactly is aPRIVATE HARD MONEY LOAN?A private hard money loan is a loan that is issued by a Lender–a private investor, fund, or company–to a Borrower.

It’s a type of asset-based loan, meaning the loan is mainly predicated on the PROPERTY’S CURRENT AS-IS MARKET VALUE.

Now, the person borrowing the money receives the funds only on the condition that they pledge the real estate as collateral for the loan. This is called a securitized loan. The security instrument is a lien on the property in the form of a mortgage or deed of trust.

So if the borrower should default on the loan, the lender/fund takes possession and ownership of the property. Make sense?

The interest rates for hard money loans are much higher than interest rates for other types of investments. For several reasons: convenience, risk, quick availability of funds, flexibility, and loan structure.

The fund management team is also adept at ‘structuring away’ the risk from you, the investor.

The team stacks the deck in your favor to make sure that your capital is as safe as can be, no matter what happens with the property. So if the borrower (let’s say a rehabber or fix and flipper) fails to comply with the terms of the deal, the fund manager contractually and legally has the option to seize the property. The fund manager then has the right to sell the property as recourse, and effectively return the capital to the investor.

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Hard money loans are attractive to borrowers for a number of reasons:

• Experienced borrowers such as rehabbers, real estate investors, operators, and contractors, don’t want to deal with the ‘red tape’ and paperwork hassle that comes with initiating a loan with a bank.

There are always stringent guidelines and loan committee processes that must be followed. Hard money loans focus more on the collateral, while traditional banks harp on things like personal credit rating, financials, and occupation.

• Many borrowers are also real estate builders and flippers, and have ample experience. They have a goal in mind with a piece of property and can spot an opportunity immediately.

So with a quick, short term loan and some personal investment in the property, they can flip it for a profit. Then turn around and do it all over again. Lather, rinse, repeat.

• Private money lenders have the ability and agility to be more creative with more challenging loan scenarios. For instance, there are strategies such as cross collateralization and more flexible loan terms…which are very attractive and for which borrowers gladly pay a premium.

Establishing reliable and trustworthy relationships with your borrower is critical for a successful and profitable enterprise.

When a borrower demonstrates that they can perform over and over again, and they continue to come back to you to fund each of their projects, it’s a homerun for the team.

• Some borrowers may have filed for bankruptcy or have credit issues, which stymies their ability to get traditional financing. When this is the case, a hard money loan is the perfect vehicle for them to climb out of hole and get back into the real estate investing game.

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And even though these borrowers may be a higher risk, your risk is minimized and your capital is protected with contractual default and forfeiture provisions in the loan agreement and in the mortgage and deed of trust.

Remember, the loan your fund manager originates is ASSET BASED, so you’re covered by the collateral.

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A RUN-THROUGH OF THE LOAN PROCESSLet’s take a close look now at the loan underwriting process, so you know how well your investment is safeguarded and protected.

Hard money loans work in a specific way, according to the terms of the loan.

Requirements involve proofing the equity in the property that’s being pledged as collateral. Timeframes for hard money lenders are super-fast. The entire process can be completed in 5-7 business days.

Once all the requirements are met and the documentation is in place, loan funding is very fast.

The loan process itself requires several core steps:

• Pre-qualification: Before the loan process starts, the fund manager gathers information about the borrower and the property. The property itself is analyzed, comped for value, reviewed, and then either rejected or approved. If it’s approved, we take it to the next step.

• Loan application: Next, the borrower completes a loan application and authorizes the lender to check their credit rating, proof of income, and any other relevant documents and history.

Both parties are briefed on exactly what the loan entails so that there’s no confusion as to the terms and conditions of the loan. Good Faith Estimates and Truth in Lending statements are given to the borrower by the lender. These docs explain all the costs, fees, rates, and financials of the loan in minute detail.

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• Processing: Once the loan application is completed, it’s submitted to a loan processor. A credit report is ordered and the collateral property is appraised. The loan processor makes sure that all documents are submitted and accurate. Verification of employment status, income, assets, and any outstanding debts is conducted.

• Underwriting: The underwriter will then assess the risk of the loan. In mortgage underwriting, loan review is based on the borrower’s finances, employment, income and credit. The collateral property is also reviewed. The ‘package’ is found either to be acceptable for a loan, or it’s rejected.

• Approval: Upon approval, the lender sends the borrower a Commitment Letter. All terms and conditions are outlined, and the clock begins. Acceptance of the offer to fund requires signatures, proof of hazard insurance, payoff demands from creditors, tax information, and escrow contacts.

• Closing: Time to fund. The closing process involves an escrow agent, the borrower, and the lender. Numbers and monies are checked and double checked. After review, the borrower signs the loan. The lender sends the loan documents to the escrow agent, and finally, transfer of funds to the seller of the property.

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Short TermHIGH INTEREST FINANCEInvesting in real estate was once quite difficult. One needed money, intricate knowledge of markets and developments, and financial savvy to make great returns.

In today’s world, there are multiple programs and vehicles designed to appeal to an individual investor’s tastes and preferences…

Low risk, high risk, stabilized properties, distressed assets, short term – medium term – long term financing, bridge loans, the list goes on. And unlike in the past, you can now invest and get involved without any specialized knowledge or specialized skills.

What you do need is liquidity. With liquidity, you tee yourself up for great returns.

If you’re looking to get into the short term, high interest finance field with real estate as your main focus, then private hard money lending is a superb opportunity for you.

You heard right – all you really need as an investor is available capital and the right team to make it possible…and a smashing success.

You have 2 choices as an investor and capital provider…

1. Spend years learning how to flip, manage, landlord, buy, sell, and rehab properties…

OR…

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2. Find a well-structured, well-managed private money fund to invest in. Merge your capital with your fund manager’s real estate expertise to create lucrative returns and cashflow.

TIP: When vetting a fund and a fund manager, ask the hard questions.

• How does the fund operate?• What types of properties do they invest in?• What are their underwriting guidelines?• How do they manage risk?• What kind of returns do you get on your investment capital?

An experienced, disciplined fund manager will have the answers to all these questions. What he or she has to say should make you feel safe and confident in their ability to wisely steward your investment.

Be wary of an inexperienced and impulsive fund manager. Though the deal and opportunity they present may look ‘hot,’ the results of funding it could be disastrous. Again, ask the hard questions.

Poor deals, weak underwriting, sloppiness, and failed processes are common pitfalls awaiting eager investors who fail to partner with the right person or company.

With experienced fund managers, you quickly learn what works and what doesn’t…what’s acceptable, and what isn’t.

The expertise and foresight of an experienced fund manager can ensure that the deal makes financial sense, and that risk is structured away from you, the investor.

In addition to gaining great returns on investment, you get to witness how the process works from start to finish. This is invaluable to your investing and wealth building career. With this kind of knowledge, you’re far less likely to make those common mistakes that all too frequently cripple the inexperienced investor.

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SAFER INVESTING IN REAL ESTATE TODAYIt’s absolutely true that investing in real estate is far safer than other investment options, especially when you have an experienced team of professionals in your corner. I’ll say this again because it’s worth repeating:

Real estate is considered safer because the investor and fund manager can manage the risk, secure the investment, and insure the asset…

Premium benefits and safeguards you don’t get anywhere else.

TOP NOTCH PAPERWORKThe hard money fund management handles all of the paperwork during the real estate transaction. Management employs strict controls to ensure your investment is as safe as possible.

To illustrate, let’s say the borrower–a rehabber on a great investment property you loaned on–misses a payment. The fund manager gives notice to the borrower to cure the missed payment (plus any late fees) in a timely manner.

If that doesn’t happen, then the fund manager has the option to foreclose and take over ownership of the property. The fund can now sell the property to recapture the full capital deployed plus all interest earned.

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DELEGATING DUE DILIGENCEThe real work begins once a fund management team identifies a property with potential.

To ensure secured returns on investment, teams of tradesmen, electricians and plumbers investigate the property for potential problems.

Next, a certified local appraiser is brought onboard…one who knows the area, the local market, and the community. This ensures that an accurate property value is established.

By knowing exactly what the AS IS current market value of the property is, the fund manager knows the exact amount of money he or she will lend to the borrower.

Any good fund manager knows that if a property doesn’t have a superb profit margin, they’ll pass on funding the deal. Better to play it safe and search for better deals than to step into something “iffy.”

EXCELLENT CASH FLOW AND ROIThe bottom line is ultimately what matters. When done correctly, a hard money loan yields an excellent return on investment, or ROI. You receive regular cash flow each month, starting from the first month.

Returns depend on many variables. Good fund managers understand how to choose the appropriate lending criteria. The criteria are based on the type of property, location, the environment, the degree of risk, and the terms of contract. Analyzing each component of the deal is vital to securing the best ROI.

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Once the rehab is complete, the property’s value and equity naturally increase. The borrower is then able to sell the property at a much higher price point than what he paid for it (the loan on which you invested).

The beauty of a hard money loan is that your capital is returned to you, along with profits and interest, in a very short time.

The best private hard money funds choose experienced rehabbers who can find, analyze, buy, rehab, and sell a property for profit in less than a year.

This is a fantastic way to grow your capital quickly. You get your investment returned plus interest…and then you re-deploy into another loan.

You also have the ability to invest in increasingly higher-level real estate loans. With prudence and patience, you can build an investment pool that’s constantly growing, returning higher margins and higher profits year after year.

If you’re new to private money lending, it’s easy to get started. All you need to do is choose a savvy, experienced, and trustworthy fund manager.

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Why People NeedHARD MONEY: COMMUNITY BUILDINGThere’s no doubt that enterprising individuals who need hard money do good for their communities. That’s why this type of investment model is referred to as ‘socially responsible investing,’ as it serves the needs of the immediate community.

Rehabs improve communities…and in turn increase property values. And that in turn attracts commerce, solid citizens, new markets, jobs, and opportunity.

So if you’re an investor who has the capital but lacks real estate experience, find an expert fund manager to guide you into the arena.

With the right fund manager by your side, you can instantly enjoy the fruitful rewards of of the highly lucrative real estate market…both in community service and profitability.

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Making The Yield:THE GOAL IN BUSINESSThe main goal in business and investing is to make money from money.

If an investor fails to put their money to work to turn a profit, there’s no wealth generation.

See, the single most common problem is that most folks lack investing experience and knowledge. However, an experienced fund management team can provide you with all the tools and pre-built proven systems to attain the holy grail of investing:

A fast, low risk way of getting into the real estate game!

And when that fund is capable of investing and RE-INVESTING your capital in deal after deal on a consistent basis, you literally create a hard money real estate loan machine that generates cash faster than any other conventional investment.

There’s nothing more compelling and exciting than cash flow. When you’re invested in the right fund, you have the opportunity to create lucrative revenue streams in record time.

So, what does it mean to ‘Make the Yield?’

Investing in its purest form is about earning interest from your money. With enough time and the right investment, there’s no limit to the amount of money you can generate or amount of wealth you can create.

Too many real estate investors go belly up because they don’t have the equity to cover the debt they’ve generated should a crisis occurs.

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Luckily, experienced managers are able to ‘structure away the risk’ through due diligence and holding rehabbers responsible for their end of the deal by imposing recourse (including fines), loan caveats and conditions, and, if necessary, refinancing of the property.

With the right fund, you’re positioned to generate sizeable yields year after year…

…Simply by cycling your capital through hard money loans and receiving interest and profits every step of the way. Few investments these days can claim to be so low risk, stable, and lucrative.

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Why is this aMAJOR OPPORTUNITY? Investing in the right private hard money fund is a MAJOR investment opportunity. Why? Because a deliberate long term real estate investment strategy is the most direct path to wealth.

While a majority of investors throw thousands away speculating on useless, unstable stocks and bonds, or choose to place their faith in ever-changing 401K plans…

You now have the knowledge to do something different.

There’s no easier, simpler, and quicker way to get started investing in real estate than with a private hard money fund.

The ROI generated by buying, rehabbing, and selling real estate is unmatched. And private money lending opens up a whole new world of investing.

It’s not uncommon for our clients to deploy their capital time and again, deal after deal. Our time-tested and proven system for vetting properties and borrowers ensures stability and instills confidence in our clients.

To find out if you’re qualified to become an investor or private lender in any one of our deals or projects, please contact us at...

Telephone: 505.404.1131

Email: robb@MountainViewCapitalinvestments.com

You can also visit our website atMountainViewCapitalinvestments.com

Call now to book a complimentary consult and find out how to get involved.

THE

HANDBOOK

PRIVATELENDER'S

FINALLY! EVERYTHING YOU NEED TO KNOW TO BECOME A REMARKABLY SUCCESSFUL HARD MONEY LENDER IN REAL ESTATE – BY AN ACKNOWLEDGED LEADER IN THE FIELD.

Are you fed up with the unstable, unreliable financial markets?

Are you frustrated with the poor returns from your stock portfolio?

Are you looking for a simple and easy way to get started investing in real estate?

Then take just a few minutes and see how you can invest in secured, high profit, low risk real estate…without ever having to buy, sell, manage, landlord, or rehab a single property.

In straightforward, no-nonsense, pull no punches language, Robb Krautbauer tells you everything you need to know about how to get started investing in a Private Hard Money Real Estate Fund.

You’ll discover the unparalleled benefits of investing in a private money fund, how hard money works, how to choose the fund that’s right for you, how to qualify properties, how to vet borrowers, how the

loan process works, and how to collect paychecks month after month.

With the author’s expert step-by-step guidance, you’ll have all the tools you need to confidently select a pri-vate hard money real estate fund that’s right for you…so you can pave the road to a life of true wealth creation.

Disclaimer: This handbook is being provided for educational purposes only. Any investment comes with inherent risk. The reader takes full responsibility for their investment decisions. It’s up to the

reader, consumer, or investor to do their own due diligence prior to selecting any investment vehicle or entrusting their capital with any individual, fund, company, or entity.

ROBB KRAUTBAUER

MOUNTAINVIEWCAPITALINVESTMENTS.COM