I have experience with hard money lending and the #1 rule for an investor is to diversify among lenders and among properties. Don’t put one lump sum into a deal. Over time you are going to end up with some foreclosures (which can take 12-24 months to cure) so you need a lender that can navigate that process as quickly and efficiently as possible. Have them show you how they’ve done with the properties they’ve had to foreclose on. If they say they don’t have any foreclosures, they aren’t telling you the truth. Also I just quickly glanced at their website and it said you get a notarized promissory note, but I didn’t see anything about a trust deed on the underlying property. you eed that and it needs to be recorded.
BTW there are tons of these guys in California and you can do better than 12%. Another nice investment is “factoring” which is where the lender/investor lends money based on accounts receivable for businesses. The loan is secured by the company’s assets and you can get 15-18%, but again you need someone with a proven track record of 20+ years in the business IMO.
