How Private Lending Works: A Complete Guide for Brokers & Borrowers

Private lending has become one of the fastest-growing funding solutions in Australia. With banks tightening credit policies and turnaround times blowing out, both brokers and borrowers are increasingly turning to private lenders for faster, more flexible access to capital.

Whether you’re a broker looking to understand private lending more deeply, or a borrower seeking fast finance for business, investment, or property opportunities, this guide explains exactly how private lending works—and when it’s the right solution.

1. What Is Private Lending?

Private lending involves loans funded by non-bank lenders, private credit funds, or high-net-worth investors. Unlike banks—which rely on rigid credit scoring and detailed financial documentation—private lenders focus on:

• Asset strength

• Equity position

• Exit strategy

• Overall deal quality

Private lending is fast, flexible, and designed for real-world scenarios where timing matters or where a borrower may not meet traditional bank requirements.

2. Why Borrowers Choose Private Lending

Borrowers choose private lending for one primary reason: speed and flexibility.

Banks can take weeks—or even months—to approve a loan. Private lenders like Assurity Capital can turn around approvals in 24–48 hours and settle in days, not weeks.

Private lending is ideal for:

• Urgent settlements

• Business cash flow needs

• ATO debt solutions

• Short-term funding gaps

• Property opportunities requiring immediate action

• Borrowers with complex structures or imperfect credit

If time, simplicity, or non-traditional circumstances are a priority, private lending becomes the strategic choice.

3. How Private Lenders Assess a Loan (The 3 Key Pillars)

Private lenders assess deals differently from banks. Decisions are based on the overall strength of the deal—not just income or tax returns.

A. The Security Property (Most Important Factor)

The primary focus is the property securing the loan, including:

• Value

• Location

• Type

• Liquidity

• Condition

Private lenders prefer strong, marketable assets such as residential homes, commercial properties, industrial assets, or land with reasonable demand.

B. The Equity Position

Most private lenders (including Assurity Capital) require:

• Clear equity

• Low to moderate LVRs

• Protection against market fluctuations

This ensures the lender’s position is safe while giving the borrower flexibility.

C. The Exit Strategy

Every private loan must have a clear and realistic exit plan, such as:

• Sale of an asset

• Refinance to a bank

• Cash flow event (e.g., business income, project completion)

• Maturity of investments

• Settlement of another property

A strong exit strategy is essential for fast approval.

4. Types of Loans Private Lenders Commonly Provide

Private lenders fill the gap between banks and real-world borrowing needs. Assurity Capital specialises in:

✓ Business Loans

Secured by equity in residential or commercial property.

✓ Second Mortgages

Ideal for businesses or investors who want to unlock equity without refinancing their first mortgage.

✓ Bridging Loans

Used for settlement timing gaps, short-term cash flow, or transitions between properties.

✓ Development & Construction Finance

For projects that banks won’t support due to timing, presales, or documentation requirements.

✓ Investment & Opportunity Funding

For property purchases, strategic investments, or short-term opportunities.

5. Documentation: What Private Lenders Actually Need

Unlike banks, private lenders don’t require:

• Up-to-date tax returns

• Profit & loss statements

• Excessive financial analysis

• Perfect credit history

• Complex application forms

Instead, private lenders focus on:

• Security property information

• Rates notice / mortgage statement

• Evidence of equity

• Loan purpose

• Exit strategy

• Identification

This makes private lending ideal for:

• Self-employed borrowers

• Business owners

• Developers

• Investors

• Borrowers with complex financials

6. How Fast Is Private Lending?

Private lenders exist to move fast.

Typical timeline with Assurity Capital:

• Same-day review of the scenario

• Indicative approval within 24–48 hours

• Settlement in as little as 3–5 days

• Faster if required for urgent deadlines

For brokers, this speed is the difference between a client securing a deal—or losing it.

7. Costs of Private Lending: What Borrowers Should Expect

Private loans are short-term solutions with pricing that reflects:

• Speed

• Risk

• Flexibility

Costs generally include:

• Interest (monthly or capitalised)

• Establishment fee

• Valuation fee

• Legal costs (transparent & fixed where possible)

Importantly, private loans are designed for short durations—typically 3–12 months—until a refinance or sale event occurs.

8. When Brokers Should Use a Private Lender

Private lending is the right solution when:

• A bank has declined or is too slow

• The borrower has an urgent settlement deadline

• Financials are incomplete or complex

• Cash flow is tight due to business cycles

• A short-term funding gap needs closing

• A borrower has equity but needs liquidity

• A property opportunity requires immediate action

Private lending helps brokers convert more deals, even when the bank says no.

9. Why Work With Assurity Capital?

As a private lender, Assurity Capital offers:

✔ Speed

Approvals within 24–48 hours.Settlements in days.

✔ Flexibility

We focus on the big picture—not minor policy issues.

✔ Simplicity

Minimal paperwork. Straightforward, practical solutions.

✔ Fairness

Transparent pricing. No hidden surprises.

✔ Broker Friendly

We work closely with brokers to help them place deals and support their clients with confidence.

Assurity Capital’s lending starts at $50,000, with no caveat loans.

10. Final Thoughts

Private lending fills a crucial gap in today’s lending landscape. With banks becoming slower and more conservative, borrowers and brokers need alternative funding solutions that prioritise speed, pragmatism, and real-world outcomes.

For property investors, developers, business owners, and borrowers with time-sensitive requirements, private lending provides a powerful and practical pathway to funding.

Assurity Capital is here to support brokers and borrowers with fast, flexible, asset-based lending designed to make deals happen.