If you’ve been keeping an eye on financial news of late, you will have noticed a definite move towards using private loan lenders in Australia.
With the big four banks tightening their lending criteria, it can be a challenge for some borrowers to secure funds.
A recent example involves Chinese property buyers, our biggest group of offshore investors, spending $24 billion in the year to June 2016.
Leading Private Loan Lender
One of the leading private loan lenders in Australia is Credit Connect Capital Ltd. Credit Connect Capital offers investments to retail, wholesale and sophisticated investors, including charities, religious groups, corporations, public and private superannuation funds, sovereign wealth funds, high net worth individuals family offices , and more.
Using a proven investment process, and many years’ experience in the industry, Credit Connect Capital meets the needs of investors throughout the world.
By offering private loans, and secured investment opportunities, Credit Connect Capital ensures the best possible outcome for all clients.
Range Of Loan Types
Private lenders in Australia provide finance for many different projects, so must have a range of different loan types. Credit Connect Capital, for example, offers construction and development loans, commercial loans, short term loans, and residential loans.
When you think about it, the goals of private lenders are in line with those of the investor, especially in regards to real estate.
Private lenders for real estate generally offer competitive interest rates, partly because the loan can be secured, but also because they are likely to be looking for investment opportunities, too.
Short Term Options
Private loans also tend to be faster and more flexible than other loan options. Unlike a bank, private loan lenders are able to make quick decisions. They also offer shorter term loan options.
Let’s consider commercial loans and, as an example, imagine the borrower needs the money to develop an apartment block. Going through traditional channels to secure such a loan – ie banks – can be long and time-consuming. To the bank, it is just a loan. But to a private loan lender in Australia, it is an opportunity.
The private lender still needs security and proof that it is a good investment, but there is more flexibility, and there’s likely to be a lot less toing and froing!
So what does the private lender gain from all this? Talk to a company such as Credit Connect Capital about investment opportunities, and you’ll see.
Check The LVR
By loaning the money to the developer, they secure an excellent opportunity for their investment clients, an opportunity which could deliver a far better ROI than anything else in the market.
Generally the borrower has some money behind them already, and essentially need a ‘top-up’. This is when Credit Connect Capital uses its LVR calculator. LVR is the Loan to Valuation Ratio – the proportion of money borrowed compared to the value of the property.
Anything below an LVR of 70% is considered safe, and if you look at Credit Connect Capital’s investment opportunities, you will see they are currently the loan offering at 55% and 63%.
So, when you look at the facts, there is a very real need for private loan lenders in Australia, if we are serious about making money!