Private lender: Any non-depository individual or entity that primarily originates business-purpose loans secured by hard assets, generally real estate.
Hard money lender: A subset of private lender where creditworthiness is determined solely by the securing real estate collateral.
Correspondent lender: A subset of private lender where the closed loan is sold to investors.
Portfolio lender: A subset of private lender where the closed loan remains in the lender’s portfolio.
Fund manager: A subset of private lender where, depending on the fund structure, the deployed capital is sourced by offering exempted securities to accredited and occasionally non-accredited private investors.
Private investor: An individual or entity that seeks a return by deploying capital through a private lender or fund; the investor may or may not be named on the loan’s promissory note.
Private money broker: Any individual or entity that acts as an intermediary between a borrower and a private lender without directly originating the loan.
No matter where your money supply comes from remember these two nuggets:
- If the deal is good finding money shouldn’t be a problem
- As long as you buy at a discount the market is irrelevant