What’s a lenders advantage to providing a private loan?

What’s a lenders advantage to providing a private loan?

Member since 2021 · 11 posts · 3 votes

Hypothetically, let's say a traditional real estate investor will get a loan from a local lender for 4%. But they have a someonr who could potentially offer them a loan for a lower %. Assuming that that person who was able to administer that loan is able to invest their money in anything else and provide a faster- ROI, why would they choose to provide their private loan to the investor? 

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  • Investor · Malakoff, TX · Member since 2017 · 2k+ posts · 2k+ votes
    5y

    They are family or a close friend. Otherwise, private money will be more expensive than conventional mortgages.

  • Member since 2021 · 11 posts · 3 votes
    5y

    @Eric James Thank you so much!

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