How a Private Money Lender Works with Borrowers and Investors

Whether you’re getting into flipping houses or want to invest in real estate, you need to know what a private money lender is. Essentially, this type of lender is a company that finances loans that do not qualify for traditional bank lending. It’s commonly used by people who intend to buy houses to fix them up and sell them at a profit. This kind of project can be very lucrative, both for the person fixing up the house and for the investors backing them. However, it can be risky, too. The higher risk is why regular banks tend not to finance them.

Get into California Real Estate Investing with Lending Xpress

A private money lender works by offering potential investors the chance to finance a house flipping transaction. While the term of the loan is short–usually a few months or years–the interest rate is typically higher than a regular home loan. Working with a private money lender is a great way to make money in California real estate investing. The lender does the vetting for the properties and the borrowers.

Because of the higher risk with this type of investing, you only want to work with a lender with a proven track record. Get in touch with LendingXpress to learn about their vetting and underwriting processes. We work with borrowers and investors and find the best deals for everyone.