What Does It Really Mean to Be a Private Lender?

The term “private lender” is used widely in the lending market — but not all private lenders operate the same way.

Some lenders promote low interest rates and fast approvals, yet still rely on institutional funding, bank-style credit processes, and restrictive policies. Others operate as true private lenders, making lending decisions based on real-world scenarios rather than rigid models.

Understanding the difference matters — especially when timing, complexity, or credit history is involved.

The Misconception Around “Private Lending”

Many borrowers assume that a private lender is simply a non-bank offering cheaper rates than the majors.

In reality, many so-called private lenders:

• Source funds from large institutions or wholesale funders

• Are bound by credit committees and policy frameworks

• Apply near-bank-level serviceability tests

• Decline deals that don’t fit a predefined credit box

While these lenders may sit outside the major banks, their decision-making flexibility is often limited.

Institutional Funding vs True Private Capital

A key difference lies in where the money comes from.

Institutional-Funded “Private” Lenders

These lenders:

• Rely on third-party institutional funding

• Must protect funder risk parameters

• Use automated or policy-driven approvals

• Often prioritise interest rate competitiveness over flexibility

As a result, deals with complexity — such as short timeframes, credit issues, or non-standard securities — are frequently declined.

What Makes a True Private Lender Different?

A real private lender deploys private capital and makes decisions internally.

At Assurity Capital, lending decisions are based on:

• The underlying asset

• The borrower’s real situation

• The exit strategy

• Commercial common sense

Rather than asking “does this fit policy?”, the question becomes “does this make sense?”

Why Interest Rate Isn’t the Whole Story

Borrowers often focus on interest rate first, but in private lending, rate alone doesn’t define value.

Institutional-backed lenders offering lower rates may:

• Take weeks to approve

• Require extensive documentation

• Decline deals late in the process

• Be unable to adapt to changing circumstances

True private lenders price for certainty, speed, and flexibility — particularly where banks and policy-driven lenders can’t help.

Credit Processes: Policy vs Judgment

Institutional-funded lenders typically require:

• Full financials and serviceability

• Clean credit history

• Standardised loan structures

• Limited exceptions

By contrast, a genuine private lender applies judgment-based credit assessment, especially where:

• Credit impairment exists

• Income is irregular or non-traditional

• Timing is critical

• A short-term solution is required

This approach is particularly valuable for:

• Business owners

• Property developers

• Investors with complex structures

• Borrowers navigating temporary financial challenges

The Role of Private Lending in Real-World Scenarios

True private lending is not about replacing banks — it’s about solving problems banks and institutional lenders can’t.

Common use cases include:

• Time-sensitive property settlements

• Bridging finance

• Short-term funding with a clear exit

• Complex or non-conforming borrower profiles

• Asset-backed scenarios requiring speed and discretion

This is where private capital and experienced decision-making make a meaningful difference.

Assurity Capital’s Approach

Assurity Capital operates as a genuine private lender, not a rebranded institutional lender.

Key principles include:

• Private capital deployment

• Direct decision-making

• Asset-backed lending focus

• Realistic credit assessment

• Scenario-based approvals

The aim is not to compete on headline interest rates, but to provide certainty, responsiveness, and practical funding solutions when they matter most.

Choosing the Right Lender Matters

When considering a private lender, it’s worth asking:

• Where does the funding come from?

• Who makes the final credit decision?

• How flexible is the process when circumstances change?

• Is the lender pricing for policy — or reality?

Understanding these distinctions can save time, prevent failed transactions, and lead to better outcomes.

Final Thoughts

Not all private lenders are the same.

Some are simply alternative channels for institutional capital. Others, like Assurity Capital, operate with genuine private funding and the flexibility that comes with it.

When certainty, timing, and commercial judgment matter more than headline interest rates, working with a true private lender can make all the difference.

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