If you ask a professional real estate investor to define real estate, he would probably call it a numbers games. Economics transcends emotions in real estate. Access to capital is a critical aspect of real estate investments, and that’s why private mortgage lenders eclipse conventional banks in the business. We’re here to find out why seasoned realtors prefer private lenders over traditional mortgage providers.


Conventional mortgage providers work through established financial frameworks. Any deal or application that doesn’t fit their stipulated criterion is rejected automatically. Private mortgage lenders, on the contrary, operate on a case-to-case basis, and this flexibility allows real estate investors to get their required capital. This custom financial framework enables private lenders to fund unconventional deals, provided the calculations make sense. For realtors, private lenders open unchartered investment opportunities, and since these mortgages are backed by a real asset, both the parties come out winning.


“Time is money.” Benjamin Franklin

This is a befitting quote for the real estate industry. Good deals are missed on a day’s delay. Real estate investors seek quick access to capital, which is the exact opposite of how conventional lenders operate. On average, a conventional mortgage would take weeks if not months to confirm mortgage approval. Although it’s unfair to blame traditional lenders considering the strict regulations surrounding mortgage approvals.

Private lenders excel at mortgage approval. Depending on their in-house team, private lenders respond between a couple of hours or days at maximum. In addition to quick approvals, private mortgage providers have tie-ups to expedite the entire underwriting process. However, do understand that private lenders are just as thorough as conventional banks, so provide them with as much information as possible. A rule of thumb for quick approval is to know the information every lender seeks and to make these details easily accessible.


Conventional banks and financial institutions will not entertain, let alone touch, borrowers with less-than-handsome credit history. The aftermath of the previous recession has lead to stringent lending requirements, and creditors practice extreme scrutiny for every single application. These tight lending circumstances open a perfect opportunity for private lenders to sweep this neglected segment of borrowers.

Private mortgage providers have flexible credit requirements, increasing the borrowers’ chances of approval. Banks refrain from lending to professionals or individuals with irregular or unconfirmed income, especially for self-employed professionals and small business owners. Private lenders analyze multiple factors in addition to visible income streams to identify the borrower’s repayment capacity. Furthermore, private mortgage players rely on personal relationships and the borrower’s real estate experience. They are more likely to lend to an individual with a proven track record.


Unlike multinational banks, private lenders are local market players. They excel in identifying local investment opportunities, and hence, are more likely to fund unconventional deals. Traditional banks rely on regional branch offices or their distant staff to analyze the deal, and more often than not, lack of local knowledge leads to rejection. Private lenders operate through a network of local experts and have local resources to evaluate the underlying deals. They are aware of the local real estate professionals and their track records. Partnering with a local real estate pro creates synergies for mutual success. Realtors with a rich network of private lenders are likely to close more deals than their counterparts.


Private lenders offer quick access to investment capital. Their custom lending practices and flexible analysis allow investors to close deals quickly. Carlyle Capital is a private mortgage lender serving clients in business-purpose residential, commercial real estate, land acquisition, commercial development, residential construction and rehab, and cannabis financing segments. If you’re a real estate investor seeking capital, talk to our experts today and get funds for your next real estate transaction.