Are you interested in passive real estate investing but not sure where to start? In this episode, Zack Lofton, the founder of Lone Ranger Capital, takes us on a deep dive into the world of hard money funds. With a focus on liquidity and diversification, Lofton covers everything from the ins-and-outs of hard money funds to the top due diligence questions investors should ask their hard money managers. Learn about the importance of education and due diligence when investing in real estate notes, as well as how to protect yourself through title insurance and vetting potential funds through track records and financial statements. Discover the key differences between debt and equity ratios that funds manage, along with the largest risk to hard money investors (which isn't property default). With insights into market volatility's impact on the hard money field, you won't want to miss this informative conversation on mitigating risks associated with passive real estate investing.

Let's dive in! ​​​​​​​

Key Highlights:

[00:00 - 05:46] Top Due Diligence Questions for Hard Money Investors

• Zack Lofton, founder of Lone Ranger Capital, talks about hard money funds in Texas

• Hard money lending is scalable due to serving a small niche and short-term nature of loans

[05:47 - 11:18] Key Considerations for Investing in Hard Money Loans and Funds

• Investing in hard money loans or funds requires understanding the business model

• Investing in an LLC that holds real estate notes provides diversification and convenience

• When investing in a fund, vetting their track record and getting audited financial statements is important

[11:19 - 20:37] Navigating the Risks and Opportunities of Hard Money Lending in Uncertain Times

• Hard money lending involves taking possession of a property in case of default

• Current market conditions make it a good time for investors to look into fixed loans

• Lower mortgage rates benefit their borrowers, but Fed rate increases affect their cost of capital

Key Quotes:

"We can push price increases to our borrowers slightly, but really not a huge way because we still have to make sure the deals pencil out." - Zack Lofton

“Having too much cash is terrible for the investors because cash sits there and it earns essentially 0%.” - Zack Lofton

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here.