Private lending involves making loans to individuals or businesses without going through a bank. It can provide higher returns than other investments like CDs or mutual funds. The process involves deciding on a loan amount and interest rate, putting the agreement in writing, transferring funds, and having the borrower make payments. Using an equity participation component allows the lender to receive a percentage of future business profits in addition to the interest on the loan. This can significantly increase potential returns. The document recommends a company called Virgin Money that assists with paperwork and loan servicing to make the private lending process simpler.

2. What is Private Lending ? Private Lending is where you act as a Lender or a Borrower to or from a private person, Corp or entity such as another Corp or LLC for instance. Broadly, it is any loan that does not involve a bank.

3. You and the Borrower decide on the terms of the loan and collateral (when applicable) for the loan. Put it in writing = make and IOU. Both parties sign the IOU and the money is transferred from the Lender to the Borrower. This can be done by the parties involved or assisted by a third party. You must charge a minimum interest rate (about 4.30% as of 3-2008) as stated by the Feds or it is considered a gift. This is called the AFR. How Is It Done?

5. As a Borrower it is actually easier to find a Private Lender than it is to go to a Bank. You can get a loan done with a Private Lender in just a few days whereas a Bank loan can easily take over 90 days! When the lost opportunity costs along with everything else is figured into the equation, Bank loans rarely make much sense for smaller companies. I am going to go over one of the easiest methods for Private Lending in a systematic process. Investing in and privately funding small private companies has never been easier or more profitable for several reasons that I will explain to you in just a minute.

8. It is like the old saying that a Banker will lend you his umbrella, but the minute it starts to rain, he wants it back and he wants to charge you for having it while it wasn’t raining. Truthfully, if you can avoid going to a Bank do so, they really are not out to help the small business owner.

9. Private Lending and Borrowing can be done safely and securely for both parties. Of course, there is always some inherent risk involved but I say there is a lot less risk than investing in stocks like Bear Stearns and Enron and hundreds of others. In spite of the doom and gloom you hear in the news, there are ten’s of thousands of small business and startups that have a very bright future and are going to do very, very well in the coming years and they need money to grow and prosper. You can prosper right along with them.

10. The following is a big picture of how it is done and in future posts I will get into more details. We have a complete course on this but, I want to give you enough information right now so that you can successfully go out and do this tomorrow. Does that sound good? Lets get started from a Lenders standpoint. If you want to be the Borrower, you can use this information to help educate your potential Lender.

13. OK, I am going to give you the name of a company that I send my clients to. They specialize in putting together the paperwork and then servicing these types of loans. But before I give you their name and you go to their site, if you sign up for our Opt in over there to the right, you are going to get some special bonuses given to you for free. I am not going to tell you what they are yet, but I can assure you that it will be well worth your while and highly advantageous for you to do so. Who am I recommending that my clients use?

14. None other than another than one of my favorite Capitalist’s new additions. Virgin Money You can find them at www.VirginMoney.com Yes, it is one of Sir Richard Branson’s New Adventures in Capitalism.

15. A couple of things to note. I am going to post this ASAP even though there is more that I want to add to this information and video, so pardon any errors. I want to get this up so that you can start thinking about this investment vehicle over the weekend. It can be one of the most lucrative investments that you can make. And no I did not forget about the equity participation part. Here it is. In addition to the interest you charge, you also add in that you will get x % of the profit for a given period as well. It is that simple. You figure out what is reasonable between you and the borrower.

16. Lend $100,000 @Interest 8% =$8,000 Plus Equity Participation of 10% Profit for the year = $150,000 EP Payout = $15,000 Total Return = $23,000 = 23% Total Return

17. I even have a calculator that you can use to figure out what types of returns you can get with and without equity participation. I will go ahead and post this and then look for an update soon. Also, I was just notified that I will be interviewing someone from Virgin Money possibly as soon as next week. It should be a great interview with lots of information that you can use on Private Lending.

18. A Couple Of Final Thoughts. In that I have both Lenders and Borrowers contacting us on a regular basis trying to find one another, we will be posting a FREE match up service that you can use within the next few weeks that is unlike any others out there that are out there. In the meantime if you are a Lender looking for a Borrower, or Vice Versa’, drop us a line and we will see what we can do to help you. Make sure to also check out our free lending report. It is packed full of information. And finally I am going to leave you with something else to think about.

19. Like with anything, this information is only valuable when you take action on it. Not that I am advocating rushing into anything, but if you are serious about doing this, and making some great returns where you are in control. Spend some time downloading our free report, do your due diligence and go out and do this. Even if you do a small loan, it is far better than sitting on the sidelines, take action. When we take action we grow and learn and frankly it is only then that we make money. To gain a new perspective, you have to try it on for size. With that in mind I am going to leave you with this.

20. Look at the lower left hand corner of the picture. Now look at the upper right hand corner of the picture. What just happened to your perspective? Investing is about perspective and seeing things that other people miss. It is about looking at things from a different angle and seeing opportunity where others do not ! Cheers, Andrew Anderson! www.IAmAnInvestor.com