Private Real Estate Lending Group in Florida

What is private lending?

Private real estate lending, also known as hard money lending or private money lending, refers to the practice of borrowing funds for real estate investments from private individuals or entities. These private lenders are typically individuals with surplus capital or specialized lending companies. They evaluate real estate investment opportunities and provide financing based on the asset’s value rather than the borrower’s creditworthiness. Private real estate lenders often focus on short-term loans with higher interest rates and more flexible terms than traditional ones.

Many investments come with substantial risk. For example, investing in the stock market puts you at risk every time the values fluctuate, as this investment avenue is incredibly volatile. Any shift in the politics of the country can cause the value of your investments to drop without much warning. The volatility of the stock market has led investors to look into other ways to invest. Real estate is a relatively stable investment avenue, and getting into private lending can help you capitalize on the increasing value of properties without having to acquire new ones. Like all other investing techniques, it’s important to always conduct thorough due diligence when entering the world of real estate investing.

In the past, those who wanted to purchase real estate typically had to go through a traditional lender (such as a bank) or a government agency, insurance company, or pension fund. But the timeline for obtaining a loan through a traditional lender can be long, and the requirements can feel endless. As a result, the need for alternative sources of real estate lending emerged in the market, pushing investors into the spotlight. An individual who wants to invest in real estate can purchase properties, but they may prefer to invest a bit more quietly.

Enter private investment property loans, or what has become known as “real estate debt funds“.

An investment loan given to a real estate investor is backed by the value of the property being purchased with the funds. Therefore, the risk is relatively low to the investor. It’s not an investment opportunity that is entirely devoid of risk, as no investment truly is. But, generally speaking, property prices don’t fluctuate as drastically as stock prices. Instead of keeping your money in a low-yield savings account or taking on the risk of other investments, you may want to consider private investing as a viable alternative.

How does private lending work?

A private lender can invest in a real estate debt fund without having to manage the work that comes with property ownership. Private lenders can also make determinations when it comes to the terms of each loan, and those terms can be customized based on each individual situation and borrower. A private loan typically has a higher interest rate than a comparable loan provided by a traditional lender, but this type of loan may be more accessible to an individual or business that a bank has turned down for a loan.

Private investors will typically review all loan requests that come through and apply their own judgment in making a decision about whether to approve or deny. Their system for analysis may include underwriting, data review, and personal evaluation. A borrower who goes through this process and is approved for a loan can typically get the funds faster than they would when borrowing from a traditional lender. Additionally, the level of transparency provided by a private lender tends to be substantially higher.

What are some of the benefits of private investing?

 

Investing your money privately through real estate funding opportunities opens the door to the ROI real estate investing without all the work that comes with buying, fixing up, and selling properties. You also don’t have to take on as much risk as you simply receive monthly payments on the loan, which include the interest at the agreed-upon rate. That interest is money directly in your pocket, received on a monthly basis. You can use it to invest in other opportunities or continue to generate passive income.

Private lending also allows you to have a hand in your portfolio. You can be as involved as you want in the loan-approval process, giving you insights into the individuals and companies that are requesting your assistance to purchase property. Some private investors choose to give guidance to their borrowers, while others remain more hands-off in the process.

Who qualifies to become a private lender?

Private lenders come from a wide range of financial backgrounds and careers. You could qualify to become a private investor if you have had success in the real estate investment market and want to expand your portfolio. Some investors have no experience in real estate, but rather have a substantial income or cash surplus and want to expand into another market, such as a CEO, physician, or lawyer. You could even be a successful startup owner or lottery winner who is looking to invest some of their capital.

Private investments come from all over. In fact, some investors get into it by helping out a family member or friend who wants to purchase real estate but may not qualify with a traditional lender. No matter what brings you into the private investing world, you can reap the benefits of real estate investing by lending your money to others and collecting interest.

The Best 100% Financing Private Money Lender in Florida

Are you interested in learning more about private investing? Our team of seasoned financial professionals at Titan Funding can provide you with more information and help you make a decision about moving forward in the process, whether you’re interested in learning more about private lending or our top strategies for mortgage note investing. We are backed by passionate banking professionals, aligned to assist individuals and businesses in meeting their capital and investment needs.

Our experience in the financial industry has put us in contact with people across the nation, many of whom are looking for investors who want to put their money into something more stable. Contact us to get started in the process of private investing and take advantage of the benefits.