Glossary
Private lender
A private lender is an individual, company or fund that lends money, usually secured by property, outside the banking system. Private loans are typically short-term and assessed mainly on the security and the exit.
An example
A business owner who needs funds quickly to pay a tax debt borrows from a private lender against an investment property, planning to repay the loan when a sale settles.
Why it matters
Private loans can be faster and more flexible but usually cost more. Many are for business purposes and outside consumer credit law, so borrowers should understand the documents and costs fully.
Points to check
Ask how the lender is funded, whether it holds an Australian Credit Licence where relevant and whether it is an AFCA member. Request all fees in writing before paying anything, and be cautious of requests for upfront fees to personal accounts. Check the default, extension and enforcement terms closely. Search ASIC's registers and read Privet's scams warning before committing.
Read about first mortgage private loans