Private Lenders Australia

A private lender in Australia is a non-ADI funding source — typically a private individual, mortgage fund, family office, contributory mortgage scheme or wholesale or sophisticated investor pool — that lends against property security on an asset-based basis. Private lenders are not deposit-takers and do not rely on retail deposits. They focus on the property and the exit strategy rather than borrower serviceability tested against PAYG income or full tax returns.

Most private property lending in Australia is structured as business-purpose lending under a business-purpose declaration, or under the wholesale or sophisticated investor exemption in the Corporations Act. In those cases the loan sits outside the National Consumer Credit Protection Act and the responsible lending obligations that apply to consumer credit. This is why private lending can move faster, but it also means certain consumer protections do not apply. Independent legal and financial advice is essential before signing any private facility.

A non-bank lender in Australia is a credit-licensed institutional lender that funds loans through wholesale funding lines and provides longer-term mortgages with full borrower servicing assessment. A private lender is a private capital source — individuals, mortgage funds, family offices and wholesale-investor pools — making short-term, asset-based loans of three to twenty-four months priced on the property and the exit, not on income servicing. The two sit in different parts of the market and are used for different scenarios. Non-bank is a longer-term institutional pathway. Private is a short-term, asset-based pathway for time-pressure or declined-elsewhere situations.

A low-doc commercial loan is a credit-licensed product where income exists but documentation is limited — for example BAS statements, bank statements or an accountant letter substituting for full financials. The lender still assesses serviceability against that income evidence. Private commercial finance is a pure asset play. There is no income assessment. The decision is driven by the property, the LVR and the exit strategy. The two products solve different problems and should not be confused. Income exists, documentation is limited — that is low-doc. No income assessment, asset and exit only — that is private.

Private property finance in the 2026 Australian market typically ranges from around 8% to 14% per annum or higher, often quoted on a monthly basis. On top of the headline rate, private deals usually carry an establishment fee of one to three percent, borrower-paid legal costs for both sides, valuation fees, a line fee in some structures, a default rate margin of three to six percent above the standard rate, and sometimes an exit fee. Every private deal is scenario-priced. Treat any range as general 2026 market context, not a quote, offer or guarantee.

Private property loans in Australia typically run for three to twenty-four months and are almost always interest-only, with interest sometimes prepaid or capitalised into the facility. The term is set by the exit, not by borrower preference. A three-to-six month loan suits an urgent settlement or auction scenario. Six-to-twelve months suits a development funding shortfall or refinance window. Twelve-to-twenty-four month facilities suit longer turnarounds, restructures or staged exit plans.

An exit strategy is the documented plan to repay the private loan in full at term end. Acceptable exits include a signed sale contract, a refinance pre-approval from a bank or non-bank lender, presales settling on a development, a defined asset turnover or a specific business event such as an insurance payout or completed restructure. Without a credible, evidenced exit, a private lender will decline regardless of how strong the LVR looks. Default interest, possession risk and the short term make exit clarity the single most important assessment item in private lending.

A caveat loan is a short-term private facility secured by lodging a caveat on the title — it is a priority protection only and does not give the lender a registered mortgage. A registered second mortgage sits behind an existing first mortgage and gives the lender enforceable mortgage rights subject to the first lender's consent. Bridging loans cover a defined funding gap between two events, usually settlement or refinance. Each suits different scenarios, security positions and exit profiles. See bridging loan vs caveat loan for a deeper comparison.

Three to ten business days is the realistic settlement range for a clean private deal in 2026, assuming a clean valuation, a registered title position the lender accepts, prompt borrower legals and a documented exit. Same-day or 24-hour settlement claims should be questioned closely. Private finance moves faster than bank or non-bank pathways, but valuation turnaround, legal review on both sides and the borrower's documentation still drive the timeline.

In most business-purpose or wholesale-investor private deals, the lender does not assess income servicing in the way a bank or non-bank does. Decision drivers are the asset, the LVR, the title position, the loan purpose and the exit. The borrower will still need to evidence identity, the entity structure, the business-purpose declaration and the proposed exit. If income evidence does exist, it can strengthen pricing but it is not the gating item it is in regulated lending.

Common situations where private finance is the only realistic pathway include an unconditional auction purchase requiring settlement in days, a mid-development funding gap a construction lender will not cover, an urgent ATO debt or business event that needs equity released against property quickly, a mortgagee sale rescue where a bank exit is imminent, a complex entity or borrower profile every regulated lender has declined, and presale or settlement shortfalls on a project already underway. Speed and asset-based decisioning are the trade-off for higher cost and shorter term. See urgent property finance for time-critical scenarios.

On default, a registered first or second mortgage gives the private lender power of sale over the secured property, subject to any prior mortgagee. A caveat does not give power of sale on its own — it protects the lender's priority and forces engagement before the borrower can deal with the title. Default interest accrues at the higher contract rate, legal costs are usually borrower-borne, and possession is a real outcome where the exit fails. The shorter the term and the tighter the LVR, the more important a credible exit becomes.

A private loan can be secured against residential property in Australia, but the loan purpose still drives whether the deal is regulated or unregulated. Where the loan is for genuine business or investment purpose against residential security, private lenders may proceed under a business-purpose declaration. Where the purpose is personal, domestic or household use, consumer credit protections apply and most private lenders will not be the right fit. The asset class and the purpose are assessed together, not separately. Independent legal advice is essential before signing.

No. Property Finance Help is not a private lender, broker, credit provider or financial adviser. We provide general information and referral support for private property finance enquiries and may connect you with a suitable private finance contact where appropriate. We do not lend, do not make credit decisions and do not provide personal credit advice. Get matched with a finance specialist if you would like to discuss a scenario.