I wanted to create a post that talks about the two private lenders I’ve partnered with in the past, their different strategies, the pros and cons of each, and how they go about their passive income strategies. My full list of [posts can be found here](https://www.reddit.com/r/passive_income/comments/kiy2zq/why_youre_not_financially_free_homepage/).
**Partner 1, Tyler.** Tyler is a rehabber who specializes in flipping distressed multi-family properties around the US. He commonly raises funds and creates promissory notes for his clients. He offers 12-month promissory notes as balloon payments with a pretty nice, double-digit APR. For example, if you invested $20,000 with Tyler, he will create a note that will pay you back, let’s say, $23,000 at the end of the term. He has a 6-year history and has never missed a payment to a partner.
**Pros.** Pros: Strong history, MF real estate is in high demand, good APR, as he often goes higher than 15%. If you invest $100,000 or more, he will give you the option of having the 1st lien on a property, securing the note (meaning, your note must be paid off first when the property sells). APR beats the crap out of the stock market.
**Cons:** Your money is tied up for a year. No monthly income. Your money is not diversified. Unsecured note unless it’s $100,000 or more. Minimum $10,000 to get on board.
**Partner 2, Bryan.** Bryan is a master short-term lender with a 20-year track record of never missing a payment to a client. He has a very savvy business model: Short-term lending each quarter (or more) for anywhere from 11% to 18% APR. He churns that money over and over again every 2-3 months, creating a nice snowball effect. You can partner with him for a nice APR while he does all the work. He pays principal and interest over a short term (3 months to 2 years) of 10% to 20% APR.
**Pros:** Solid track record of never missing a payment to a client. Your funds are diversified. He has a massive overhead fund in case of default. He only lends money to established, qualified vendors and sub-contractors. Any funded events are insured. Pays monthly income in a little over 30 days from signing of a contract. APR is the best I’ve found for a non-accredited investor.
**Cons:** Unsecured note. Minimum $10,000 to get on board.
Okay, folks, that’s the nuts and bolts of it. I really like the idea of partnering with a private lender instead of being a private lender because I don’t want a job. I want true, passive income that comes in when I need it to come in. As some of y’all know, I’m more or less retired off these gents and I’m working to transition more of my monthly income into real estate for a bit more diversification.