Private Lending Network | Connecting Investors & Lenders

      ℹ️ About 716Lend: We're an information hub and sponsorship platform for private lending. We are not a lender, broker, or financial advisor. We provide educational content and connect investors with licensed private lenders. Consult licensed professionals for financing decisions.
    

What is Private Lending?

Understanding the Private Lending Ecosystem

Private lending is non-bank financing provided by individuals, investors, or private companies to real estate investors. Unlike traditional banks that rely on credit scores and W2 income, private lenders evaluate deals based on property value and investor experience. This makes private lending the preferred financing method for real estate professionals nationwide.

The private lending network includes dozens of lender types, each serving specific needs. Understanding where lenders fit in the ecosystem helps you find the right financing for your deal.

Types of Private Lenders

Hard Money Lenders

Speed specialist. Lend based on property value (LTV 70% typical). Fastest closings (3-7 days). Highest rates (12-18%). Best for: Short-term fix-and-flip with clear exit strategy.

Private Money Investors

Flexibility specialist. Individual investors or small groups lending personal capital. Rates typically 8-14%. Closing time 7-14 days. Best for: Relationships-based financing with proven track record.

Portfolio Lenders

Growth specialist. Banks or companies holding loans in-house. Flexible underwriting, multiple properties, LTV 65-80%. Rates 7-11%. Best for: Building rental portfolios and long-term hold strategies.

Bridge Lenders

Gap specialist. Short-term financing between purchase and sale or permanent refinance. Rates 9-16%. Closing 5-10 days. Best for: Time-sensitive transitions and dual closings.

Construction Lenders

Development specialist. Fund new construction or major renovations with disbursements during work. Rates 8-12%. Closing 2-3 weeks. Best for: Ground-up development and substantial rehabs.

How Private Lending Works

Private lending follows a predictable process designed around speed and asset value:

Deal identification — Find property with clear value-add or rehab opportunity
Underwriting — Calculate purchase price, renovation budget, after-repair value, exit strategy
Lender outreach — Submit deal package to potential lenders
Pre-approval — Lender preliminary review and term sheet
Appraisal — Property value assessment by third party
Due diligence — Title, lien, legal, property inspection reviews
Final approval — All conditions cleared, loan ready to close
Closing — Documents signed, funds disbursed to title company

Key Advantages of Private Lending

Speed

Close in 3-14 days vs. 30-60 days with traditional banks. Critical for competitive deal situations.

Flexibility

Asset-based decisions mean credit score, income verification, and employment history matter less. Perfect for self-employed or non-traditional income profiles.

Local Expertise

Regional and local lenders understand market dynamics, neighborhood values, and investment strategies specific to their area.

Specialized Programs

Fix-and-flip, bridge, construction, rental financing — programs tailored to specific deal types and investor needs.

Private Lending Terminology

Understanding common terms helps you evaluate lenders and compare offers:

LTV (Loan-to-Value) — Loan amount divided by property value. 70% LTV means 70% of property value financed, you put down 30%.
ARV (After-Repair Value) — Property value after renovation completed. Critical for fix-and-flip deals.
Points — Upfront lender fees. 1 point = 1% of loan amount. Typical range: 1-3 points.
Hard Costs — Direct renovation expenses (labor, materials). Excluded from soft costs.
Soft Costs — Indirect expenses (permits, inspections, insurance). Included in total project budget.
Exit Strategy — Plan to pay back loan (sale, refinance, cash-out). Private lenders require clear exit plan.
Seasoning — Time required holding property after purchase before refinancing (typically 6-12 months).

Ready to Access Private Lending?

Join the network connecting real estate investors with private lenders. Whether you're seeking financing or offering capital, 716Lend facilitates connections across the private lending ecosystem.

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Frequently Asked Questions

Is private lending legal?

Yes. Private lending is legal nationwide. Licensed lenders must follow state regulations. Always work with licensed professionals.

What credit score do private lenders require?

No minimum. Private lending is asset-based, not credit-based. Lenders evaluate property value and exit strategy, not credit score.

How do I compare private lending offers?

Compare total cost of capital: rate + points + fees. Get complete fee disclosure from all lenders. Lowest rate isn't always lowest total cost.

Can I use private lending for rentals?

Yes. Portfolio lenders and some private investors specialize in long-term rental financing with flexible underwriting.

What happens if I can't pay back a private loan?

Private lenders have lien on property. If loan isn't repaid, lender can foreclose. Always have clear exit strategy before borrowing.

Is 716Lend a private lender?

716Lend is an information hub and sponsorship platform connecting investors with private lending solutions. We occasionally lend private capital to local investors and provide educational content through our sponsorship program with licensed lenders.