The cover letter that you include with your private lending credibility kit will determine the first impression you will make on a private lender. Creating an effective cover letter will also determine whether or not the private lender continues to review the remainder of your portfolio as a potential borrower.
A well written cover letter that communicates to the private lender(s) that you are worthy of his/her time and also demonstrates that you are serious about your business as a professional.
In general, there is no specific format for creating a cover letter; however, there are general guidelines that will make the letter worth reading.
Be Brief and to the Point
Use Only One Page: The cover letter should not utilize more than one page. Get right to the point and introduce yourself in the first paragraph and briefly explain why you are seeking private lending for your real estate transaction.
Personalize Your Greeting: When possible address the lender by name instead of using something generic like “Greetings” or “To Whom It May Concern.” People relate to the sound of their name and by addressing them as such, it will grab the lender’s attention as well as let them know you took the time to learn their name.
Promote Your Accomplishments: Present your accomplishments in a conversational tone that speaks to the reader. Briefly explain how your accomplishments will contribute to the success of a real estate transaction with the lender. Make this statement compelling enough to encourage the reader to discover more about you in your credibility kit.
Be Clear and Direct: Specifically state your purpose and goals for entering into a transaction with the lender. Do not word the letter so the private lender has to guess why you are contacting them. Lack of clarity communicates lack of purpose and direction.
Plan to Follow-Up: Specifically indicate in the letter how the private lender can contact you and describe your plans for follow-up and then make sure you follow through with the plans you stated in the letter.
Encourage the Private Lender to Read On: Provide a sentence in the letter that encourages the lender to continue to read the remainder of your private lending credibility kit. This can be accomplished by making reference to an interesting component of your portfolio.
Thank the Potential Lender: Thank the potential lender for his/her time and encourage contact. Reinforce the fact that you plan to follow-up within a specified amount of time.
Review the Letter: The old adage of “two set of eyes are better than one” goes a long way when it comes to proofreading the cover letter for your private lending credibility kit. Many times someone else will catch errors that you did not notice because you wrote the letter. A cover letter with errors will send a message to the lender that you could not be bothered to proofread the letter, and may cause them to question your ability to successfully complete a real estate transaction.
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