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What You Need To Know About Private Lending

Asset based, real estate private lenders are non-bank mortgage lenders or private individuals who loan money to get better returns on their investments by lending to businesses, secured against properties. Sometimes, private lending is also called peer-to-peer lending. Where major banks have strict lending criteria, private lenders have a more opportunity-centric approach in funding businesses, eliminating the cumbersome approval process.

Private Lending

Why consider private lending?

Private lending is a niche loan product that serves very specific purposes. Is private money lenders' interest rate higher? Generally, yes. Why pay more when any would get you from point A to point B, you asked?
In most cases, the answer is speed. Whilst traditional lenders would normally take an average of 6-8 weeks to approve a loan, private lenders could often do it in the same day, and ofen, within-hour of reviewing the application. 

Who is private lending for?

In most cases, people who acquire private loans are "asset-rich, cash-poor" business owners who require short term, immediate funding to "bridge" a shortfall for urgent or golden business opportunities, or developers who form a new, special purpose company to work on specific project, therefore not having financials to show.

Some of the private lending services / solutions Twelve Grains Capital could assist with with:



Like any other loans, private financing does carry a level of risk. However, it is important to note that private lenders, as well as any traditional lenders, are regulated by the government in Australia, albeit by different regulators.

Some of the PROS of private lenders:

  • Easy access and fast turnaround - less paperwork, less headache.

  • No background/credit check - private money lenders only care about the security property and your exit strategy.

  • Flexible term - generally, private lenders are more flexible when it comes to security type and serviceability requirements.

Some of the CONS are:

  • Origination cost - establishment fee of 2-5% of loan amount on top of interest rate is not uncommon, add more (brokerage) if the loan is introduced by a specialist.

  • Interest rates - there is rate for risk. Generally private lenders are expecting a return of 9-15%pa, some even expect 20%.

  • Short term loans - unlike banks that allow you to pay back in 30 years, most private lenders expect you to pay the loan back in 6-12 months, some of the more lenient ones will allow a couple of years.

HOW DO I QUALIFY for private finance?

Most private lending services will only lend on business purposes (non-coded / non-NCCP regulated loans). Business purposes can mean purchasing commercial property, cashing out to assist with cash flow of the business, or purchasing properties under company structures. The funds can't be for personal use, e.g. purchasing a residential property for owner occupation. You will be required to sign a declaration that the fund is to be used for business purposes.

Private lenders will make decision based on 3 things:


  • Security (location, LVR, asset class, etc)

  • Purpose

  • Exit strategy

WHEN SHOULD I APPLY for private lending?

Turnaround time for private money lenders is generally a lot quicker than traditional lenders. Some lenders can release funding in as little as 24 hours, while most can set a deal in 2-3 weeks.​ It all depends on the complexity of the deal, size, location (accessibility to valuers), etc.

Ideally you'd want to make contact with private lenders within a few weeks before you need the funds, this way it gives you and the lender enough time to structure the deal appropriately.


Twelve Grains Capital access private mortgages from a portfolio of high net worth investors who align with our goals and beliefs. For real-estate-secured business loans, we eliminate restrictive red tapes to settle deals quickly where most banks fail.

We specialise in loans between $2m to $70m+ for:

  • First mortgages (up to 70% LVR)

  • Bridging finance

  • No presale construction loan and development finance

  • Rates from 6.99% interest only

Urgent business finance solution (settled in as little as 48 hours!):

  • Interest rates: from 1%pm 

  • Loan Size: $100k to $50 million. Larger loans considered.

  • Stretched mezzanine debt

  • 1st and 2nd mortgage 

  • Up to 70% commercial/residential

Security options:

  • Property / rural / residential & commercial

  • Vehicles, plant and equipment

  • Shares and jewellery 

  • Specialised security 

  • Variety of cross collateralised security options

Twelve Grains Capital provide private lending services to Australia-wide clients with focus on Sydney, Melbourne, and Brisbane​ metro.

* Disclaimer: rates and LVR are subject to change depending on risk. T&C's apply.

Where To From Here?

Speak to a specialist about private lending

You've considered your options, and decided private lending might be right for you, or maybe you have more questions. The next step is to get in touch with us. Don't worry, this won't appear on your credit report.


David R. Sutantyo

Managing Director

0413 505 402

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