Cash advancements, private loans, and/or payday loans are an easy way to invest in your paper income stream. Everybody has had someone come to them at some point in their life, maybe more often then some, and ask to front some cash. Usually these individuals are our friends and/or family, and typically if the spare cash is there, most of us will lend the amount asked. I know I have always been a little reluctant to lend money when I was younger, because I usually expected a long wait time to get that money back and no more than what I had lent out in the first place. Every time I did this, I actually lost money, because money is always worth more today than it is tomorrow.
When Curiosity Leads to Interest
When we are approached by someone who wants to “borrow” money from us, one of our first thoughts is to ask what the money is for. Now, I ask myself “Why should I care?” followed up by “Am I an underwriter for Fannie Mae or Freddie Mac?” What we should be asking (the individual that is), “How are you going to pay me back? Why should I be interested in loaning you money?” Interest is the key word here. Since our currency is always losing value, money is worth more today than tomorrow, so in order to create a win/win situation there needs to be interest for the lender to gain access to his capital. The borrower could have easily gone to a bank and got a personal loan, but usually banks will not write up a loan for any less than $500-$1000. You are the solution for this individual if they need a smaller micro-loan, just to help get them through a week or two. For the borrower, you represent an easy and convenient way to gain access to quick cash. You should never feel guilty for wanting to negotiate terms and interest rate/returns on capital you earned.
The Risk, the Collateral, and the Reward
The next time somebody comes to you to borrow cash, you can see that as a possible opportunity to make a short term investment and put your money to work! Of course this is contingent upon whether or not that somebody meets your risk to reward standards. Perhaps this person has no income at all, and just works “odd jobs” here or there. Yeah, the term of the loan mine as well read “results may vary” if you decide to give that person your money. You could still make a loan possible for that individual, if they were to offer up some collateral that you could flip for a profit if they don’t end up paying back. When you give your money to someone, because of who they are (friend/family/neighbor), then you are making a fundamental analysis, but fundamentals are only half of the risk/reward process. You should take a look at the debt to income ratio involved with the technical analysis. Are they asking for more than the numbers say they will be able to pay back? This is all common sense stuff for most of you, eh? I think I should give you all one example of how to make quick returns, by sharing my private loan investment method.
Make 100% ROI in a Month with $400
Here’s everything you need to get started in turning $400 into $800, in a single month:
· $400
· 4 – 16 people who “need money now!”
· Pen and Paper
That is it! There are specific steps and terms for my personal method for loaning my cash, and you may want to add or fine tune the terms of the agreement based on results of financial analysis or preference. If you are going to charge late fees or penalty fees, you really should consult an attorney or financial advisor before writing up your contract, because some states have strict laws/regulations about cash advancement and payday loan fees/ procedures. They may even be illegal where you live!
Here are my steps to my 100%ROI $400 monthly method once you have a qualified borrower:
Step 1- Secure a Committed Loan Amount
The most I loan, using this method, is the full $400, if the borrower’s risk/reward standard meets the criteria. The least I loan out is $100. To protect the investment capital, the loan should be “secured” in some way other than just a signed written agreement. I have two ways of “securing” these personal loans:
· A tangible item of Value is held as a collateral until the end of the loan term - (You can check an item’s liquidity through commerce sites like Amazon and Ebay & see how well it’s selling, and get an idea of value) If I am going to become a personal pawn shop then I will make sure that the item I will hold as collateral is worth at least 150% the loan amount, because if the borrower doesn’t pay me back then I need to account for compensation needed for the time/work put in to liquidate that item and get my capital back.
· The borrower writes a check for cashing at the end of the loan term - The due diligence I conduct when qualifying a borrower includes looking at recent paystubs, when applicable, and identifying a checking account in their name (using an ID/Driver’s License, and address on paystub). If they receive a direct deposit from their employer to that account on payday, than that’s a plus! I have the borrower include the agreed sum of the interest involved with the loan added to the principal amount of capital borrowed, written on the check. The check is cashed on the agreed upon date for the term of the loan.
Step 2 – Set the Interest Rate and Terms
In this method, a qualifying borrower could receive a loan between $100 - $400 for a term of one business week (five weekdays) or one pay period (if paid weekly). An interest rate of 25% is optimum for this type of short term loan, because it will only be applied once. Your target return for this method is $100 a week. You may want to research your specific state’s usury laws before putting anything you are unsure about in writing, and if you are still in doubt, you should consult a financial attorney. Make sure you are clear about what will put the borrower in default of the loan agreement (like a bounced check, failed payment) and put what happens in the event of default (item held as collateral is forfeited as payment, late fee, etc.).
Step 3 – The Payoff
If you were diligent during your analysis and qualifying of the borrowers, and took the steps to “secure” your investment then your risk should be greatly reduced. Once the term has come to an end collect your payment or deposit the check into your account. If you are successful in your efforts then you should be able to double your $400 investment within a month, averaging a $100 return each week. You want 1-4 borrowers a week to use up the full $400 investment, and pay it back within five business days to make it available for the next set of borrowers. This of course is best case scenario, but if you want to get your paper income stream rolling, this method is a good way to save up towards say, opening up a trading account with a broker (online), which usually you want at least $2000 to start. Five solid months of letting your $400 work for you (or less if you compound the amount you invest month over month) and you are on to more secure methods of investing in your paper income stream.
When we are approached by someone who wants to “borrow” money from us, one of our first thoughts is to ask what the money is for. Now, I ask myself “Why should I care?” followed up by “Am I an underwriter for Fannie Mae or Freddie Mac?” What we should be asking (the individual that is), “How are you going to pay me back? Why should I be interested in loaning you money?” Interest is the key word here. Since our currency is always losing value, money is worth more today than tomorrow, so in order to create a win/win situation there needs to be interest for the lender to gain access to his capital. The borrower could have easily gone to a bank and got a personal loan, but usually banks will not write up a loan for any less than $500-$1000. You are the solution for this individual if they need a smaller micro-loan, just to help get them through a week or two. For the borrower, you represent an easy and convenient way to gain access to quick cash. You should never feel guilty for wanting to negotiate terms and interest rate/returns on capital you earned.
The Risk, the Collateral, and the Reward
The next time somebody comes to you to borrow cash, you can see that as a possible opportunity to make a short term investment and put your money to work! Of course this is contingent upon whether or not that somebody meets your risk to reward standards. Perhaps this person has no income at all, and just works “odd jobs” here or there. Yeah, the term of the loan mine as well read “results may vary” if you decide to give that person your money. You could still make a loan possible for that individual, if they were to offer up some collateral that you could flip for a profit if they don’t end up paying back. When you give your money to someone, because of who they are (friend/family/neighbor), then you are making a fundamental analysis, but fundamentals are only half of the risk/reward process. You should take a look at the debt to income ratio involved with the technical analysis. Are they asking for more than the numbers say they will be able to pay back? This is all common sense stuff for most of you, eh? I think I should give you all one example of how to make quick returns, by sharing my private loan investment method.
Make 100% ROI in a Month with $400
Here’s everything you need to get started in turning $400 into $800, in a single month:
· $400
· 4 – 16 people who “need money now!”
· Pen and Paper
That is it! There are specific steps and terms for my personal method for loaning my cash, and you may want to add or fine tune the terms of the agreement based on results of financial analysis or preference. If you are going to charge late fees or penalty fees, you really should consult an attorney or financial advisor before writing up your contract, because some states have strict laws/regulations about cash advancement and payday loan fees/ procedures. They may even be illegal where you live!
Here are my steps to my 100%ROI $400 monthly method once you have a qualified borrower:
Step 1- Secure a Committed Loan Amount
The most I loan, using this method, is the full $400, if the borrower’s risk/reward standard meets the criteria. The least I loan out is $100. To protect the investment capital, the loan should be “secured” in some way other than just a signed written agreement. I have two ways of “securing” these personal loans:
· A tangible item of Value is held as a collateral until the end of the loan term - (You can check an item’s liquidity through commerce sites like Amazon and Ebay & see how well it’s selling, and get an idea of value) If I am going to become a personal pawn shop then I will make sure that the item I will hold as collateral is worth at least 150% the loan amount, because if the borrower doesn’t pay me back then I need to account for compensation needed for the time/work put in to liquidate that item and get my capital back.
· The borrower writes a check for cashing at the end of the loan term - The due diligence I conduct when qualifying a borrower includes looking at recent paystubs, when applicable, and identifying a checking account in their name (using an ID/Driver’s License, and address on paystub). If they receive a direct deposit from their employer to that account on payday, than that’s a plus! I have the borrower include the agreed sum of the interest involved with the loan added to the principal amount of capital borrowed, written on the check. The check is cashed on the agreed upon date for the term of the loan.
Step 2 – Set the Interest Rate and Terms
In this method, a qualifying borrower could receive a loan between $100 - $400 for a term of one business week (five weekdays) or one pay period (if paid weekly). An interest rate of 25% is optimum for this type of short term loan, because it will only be applied once. Your target return for this method is $100 a week. You may want to research your specific state’s usury laws before putting anything you are unsure about in writing, and if you are still in doubt, you should consult a financial attorney. Make sure you are clear about what will put the borrower in default of the loan agreement (like a bounced check, failed payment) and put what happens in the event of default (item held as collateral is forfeited as payment, late fee, etc.).
Step 3 – The Payoff
If you were diligent during your analysis and qualifying of the borrowers, and took the steps to “secure” your investment then your risk should be greatly reduced. Once the term has come to an end collect your payment or deposit the check into your account. If you are successful in your efforts then you should be able to double your $400 investment within a month, averaging a $100 return each week. You want 1-4 borrowers a week to use up the full $400 investment, and pay it back within five business days to make it available for the next set of borrowers. This of course is best case scenario, but if you want to get your paper income stream rolling, this method is a good way to save up towards say, opening up a trading account with a broker (online), which usually you want at least $2000 to start. Five solid months of letting your $400 work for you (or less if you compound the amount you invest month over month) and you are on to more secure methods of investing in your paper income stream.
