Why You Should Use Private Lenders For Your Real Estate Business

Most real estate investors who are employed find it easier than those who are self-employed to obtain business loans from banks.

But does this disadvantage turn out to be one?

Hardly. This is for the simple reason that there exists another option: private lenders.

In one instance, a real estate investor found a home that he intended to redo and sell quickly at a profit but thanks to the home not having a furnace, the bank took months to approve the loan – almost four-and-a-half months, to be precise!

Just imagine what would happen if every home that could be fixed and sold for a better price took this long to be financed!

With private lenders, of course, the money is always available, and one does not have to go through a mountain of paperwork to get a loan approved. In fact, using the readily available funds that private investors have means while competitors are busy looking for a loan approval from a bank, you could have already bought the home and begun renovation.

So, it’s simple to understand that using funds that private investors have means being able to get things done faster, while making a quick profit too.

Speed, they call it!

Another advantage that occurs with private lenders is that while some of them might like to receive a monthly payment with interest for the loan taken, there are others that don’t.

One way to make these loans work for you is to structure it in such a way that you don’t spend anything from your pocket until the home you’ve renovated is sold.