Episode 824
One of the best things about investing in real estate is the use of "other people's money" or OPM. You can use OPM to pay for your deal while you get all the cash flow, appreciation and tax benefits. What do we need to know about the lending environment today?
In this episode, we'll hear from private real estate lender Brian Stark. Brian has more than 20 years experience as a lender and is currently VP of Originations at real estate lender Icecap Group in New York City. He has actively invested in single-family, multi-family, and commercial real estate. He's bought and sold hundreds of properties, wholesaled many more, and originated more than 1,400 real estate loans totalling well over $150 million.
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Transcript:
[00:00:00]
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Presenter: You're listening to The Real Wealth Show with Kathy Fettke, the real estate investors resource.
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Kathy Fettke: One of the best things about investing in real estate is the ability to use OPM, other people's money, to fund your deal. Yet you get all the tax benefits, the appreciation, and the cashflow from that deal while somebody else pays your loan off for you. What is the lending environment today? I'm Kathy Fettke and welcome to The Real Wealth Show.
Our guest today has been a private real estate lender for about 20 years. Brian Stark is VP of originations at IceCap Group, a direct private lender in New York City, making loans to real estate investors nationwide. He's wholesaled hundreds of properties, bought and sold hundreds of properties, and originated over 1,400 real estate loans, and he's here with us today on The Real Wealth Show. Brian, welcome.
Brian Stark: How wonderful to be with you, Kathy. How are you today?
Kathy: I am doing wonderful. I'm glad to have you on because we're seeing some changes a bit in lending, and I would love to get some understanding of it. We're seeing interest rates go up, how much have they gone up, and do you think that will continue?
Brian: Not to be contrarian, but the truth is, in the investment side, we still see rates pretty well depressed. Not in a negative way, we see them held pretty low. In some areas, they're even going down a tiny bit because there's so much investment activity and there's a lot of, you would call it competition among lenders, like the company that we run and others like us. Everybody's feeding for the borrowers and depressing rates a little bit. While there's a little interest rate bump for consumers, I think investment rates are staying stable, or maybe reducing a tiny bit.
Kathy: [00:02:00] That is really good news.
Brian: It's great news.
Kathy: I could see that because there's so much money out there chasing some kind of yield and not able to get it, but lending provides that. I'm not surprised, but I just haven't really heard that. Is it more private lenders and not so much the Fannie, Freddie lenders, the conventional?
Brian: Yes. For the purpose of this discussion, Kathy, there's two buckets, if you will. One bucket would be government-backed money like Fannie, Freddie banks, the people with the big fancy buildings downtown. Then the other bucket would be all the private lenders. When we say private lenders, we're not just talking about the nice guy that you sit next to in church who's got a couple of hundred thousand in their IRA, I'm talking about what have now become, in the last five, six years, multi-billion-dollar companies that have raised huge rounds of c
Published on 4 years, 8 months ago
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