The reasons are varied and all can be resumed by the fact that traditional mortgage
loans lack the flexibility that private loans feature.
As the name suggests, private mortgage loans are offered by private lenders. Although traditional financing sources such as banks, lending institutions, or government agencies play a major role in financial enterprise, the private mortgage loan system has curved a niche for itself.
Private Mortgages: The Concept
Private mortgage loans are usually short-term hard money or asset-based loans. Generally, these loans are granted depending on the equity and value of the property being put up as collateral, not on the borrower’s credit. People who don’t want to go for conventional loans can easily take advantage of private mortgage loans. These loans are a source of funding for professional real estate investors who wish to a