PLP-119 March Due Diligence for Private Lenders


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Hello Lender nation and welcome to episode 119 of the Private Lender Podcast, I’m your host, Keith Baker and I’d like to thank you for sharing your time with me today.

If you’re looking for practical tips and advice on Private Lending and how to keep your money safe as a Private Lender, then you are in the right place. But if you want to learn from my mistakes so you can avoid them, well then pull up a chair and pour yourself a drink my friend, because this podcast is just for you!

In today’s episode, we will cover a few items of due diligence every Private Lender should perform if they do not utilize the services of an escrow or loan servicing company.

But before we launch full speed into today’s episode, I need to perform a little housekeeping of my own.

Guys, I have not been producing much content lately. I mean, I’ve been quiet over the last 12 months - I didn’t produce one episode in February of 2021.

I could blame a lot of things such as Covid, kids, divorce, death in the family, additional family drama, anxiety, depressive episodes and let’s not forget Texas became an ice cube for a few days recently.

But the truth is this: I chose not to produce episodes, or content, or the Private Lender Academy that I’ve been threatening you with, since forever.

I didn’t consciously choose NOT to do anything, but I now see that I chose to stay with the familiar feeling of procrastination due to a failed sense of perfectionism. Meaning I chose to stay in my comfort zone and watch the world go by as I wondered why I wasn’t making any progress toward my goals.

Well, I hope I can say I’ve finally gotten off my ass and put that mindset behind me. So let’s gets going and do some housekeeping:

PLP Facebook group: Private Lender Podcast (public)

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Ok, let's get down to the brass tacks -

t is now March, and time for us Private Lenders to perform a little due diligence.

1- Did you send out 1098’s or mortgage interest statements in January?

2- Were the property taxes paid by the end of January? Public record, so you can confirm this via the web in most counties in the US.

3- Insurance premiums paid?:

a. Property

b. Windstorm

c. Flood

d. Seismic

4- HOA dues paid?

The 4 previous points are performed on your behalf if you use an escrow or loan servicing company. This is why I suggest as a private lender you should utilize these services because they make your life easier and the borrower pays for the service!

It is a condition of retail mortgages and all my Private Loans that the borrower stays current and pays the insurance premiums and taxes. If your borrower is not paying these on time it could mean they are in trouble or quickly arriving at trouble, or perhaps cashflow is being delayed. Your job is not to ask “why?”

5 - The last thing I like to do at least once a year is to drive by the properties on which I have a lien and assess the condition of the property. Obviously, I want any property I lend upon to be in good condition, but it depends on the property and my Private Loan’s use.

A - So if I have a loan on a rental property, I want to see that the borrower and tenant are both maintaining the property’s condition and appearance. Curb appeal is very important to me even with the lower value rentals and required with nicer properties.

B – If I’m loaning to an investor who has sold the property with owner financing (beneath my lien) I want to see the buyer is performing the needed repairs.

C – this does not apply to flips or new construction, obviously. You will want weekly inspections/updates to ensure the project is moving ahead and the borrower is not getting into trouble.

To recap the Private Lender’s due diligence to-do list:

1- Did you send out 1098’s/mortgage interest statements?

2- Did your borrower pay the property taxes?

3- Did your borrower pay the required insurance premiums?

4- Have the HOA dues been paid?

5- Drive by the property

We all intrinsically know that no investment is 100% safe, but with a little effort, you can help secure and ensure the safety of your money and investments. And that’s the moral of today’s episode. I would like to thank you for playing!

Here’s the deal, I don’t charge money for this show, but there is a cost and I would be extremely grateful if you would help drive awareness to the show, to get the word out by leaving me an honest rating and review over at Google Podcast, Spotify or whatever platform you are using to hear my voice. But it would mean the world to me if you could leave an honest rating and review over at iTunes because it's apple and they're still the benchmark.

It doesn’t take that long and it’s a small price for the value I try to provide.

And if you are looking to create your stable of private lenders, or know people who have money but don’t realize the power of private lending, please, please send them a text, an email, a DM, and introduce them to me and the PLP.

That’s gonna do it for Episode 119 and just a few final thoughts:

1 – please join the Private Lender Podcast Facebook group to connect, learn, inspiration and discussion

2 - Remember, the easy button to lending in the Houston, TX market can be found at

So, as I sign off I’d like to say in addition to self-awareness, I wish you safe and prosperous Private Lending.

I’ll catch you on the next episode.


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