For the real estate investor in search of an entry point into their next venture, the alternative money lender or private lender is an essential resource. It is often quicker and easier to use a private lender than the equivalent traditional bank lending options.
In private money deals, there are three principals to the requisite transactions – three principals who all participate with total transparency: the private lender, the real-estate-investing borrower, and the source of those funds, the private investor. It is requisite for a successful transaction that all three not only achieve their desired return on investment but enter into the transaction with confidence (trust) that they will do so.
ReProp, as the private moneylender, has adjusted its loan preferences toward single family residential construction, based on the statistics for today’s markets. The hesitancy of banks and the Federal Reserve Board to lower rates has filtered through all the real estate market and its lenders – including private moneylenders like ReProp.
In the case of commercial loans, especially those from private moneylenders and hard moneylenders, the borrower is as interested in return on investment as the lender and the real estate investors who provide the requisite hard money. As the entity that brings all parties together in a transaction that provides mutual financial satisfaction, the private moneylender (ReProp) chooses investors and borrowers with minimal risk. However, their desired objectives may or may not align with standard bank guidelines.