Why Private Financing
- Home
- Why Private Financing

Why Private Financing
Private financing offers an alternative to traditional mortgage loans, providing flexibility and opportunities that can make it an attractive option for certain borrowers and investors. Here’s why private financing might be the right choice:
Flexible Approval Process
Unlike banks, private lenders focus on the value of the property and potential for return rather than solely on credit scores and income history. This flexibility can be ideal for borrowers with unique financial situations or limited credit history.Faster Funding
Private financing can be a much faster process than traditional mortgage lending. With fewer requirements and a streamlined approval process, borrowers can often secure funding within days, making it perfect for time-sensitive transactions.Access for Non-Traditional Borrowers
Self-employed individuals, foreign investors, and those with fluctuating income can find it challenging to meet bank criteria. Private lenders are more accommodating of these profiles, offering solutions when traditional financing isn’t available.
Compares Private Financing And Traditional Bank Financing:
Private Financing | Traditional Bank Financing |
---|
Property Purchase Price | $100,000 | $100,000 |
Expected Rehabilitation Cost | $30,000 | $30,000 |
Initial Loan Disbursement | $80,000 | $80,000 |
Appraisal Fees | $0 | $1,500 |
Legal Fees | $600 | $900 |
Other Fees / Points | $3,000 | $1,200 |
Amortization | None | 20 years |
Time to Close | 5 days | 45-60 days |
Construction Disbursements | Up to $28,500 | Unavailable |
Initial Interest Rate | 10.0% | 6.5% |
Other Requirements | Personal Financial Statement and Basic Diligence | Extensive Diligence Documentation, Including multiple follow up requests, potentially |
Illustrative Total 3- month Loan Cost | $5,600 | $4,900 |
Illustrative Initial Monthly Payment | $667 | $605 |