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Private Lending

Are you looking to invest in the exciting Indianapolis real estate market? If so, our team at Invest With Ben is here to help you. Enjoy easier, quicker, and more cost-effective real estate investing thanks to our application of private real estate lending and portfolio of highly discounted properties, some of which are available wholesale.


If you are new to real estate lending, then you might likewise be new to “private investing” and “private mortgage notes.” We’re here to demystify the terms and get you the information you need to take that next big step in your real estate journey:


Private Lending: Indianapolis Real Estate Investing Made Easy

What Is Private Lending?

The term private lending refers to any type of funding that comes from a lender that is not defined as a “public lending institution” by governmental regulators.


That term – public lending institution – is a very specific one that the federal government uses to describe conventional sources of financing. Such conventional institutions include banks, mortgage companies, and credit card companies. Every institution listed or lumped in as a public lending institution must follow certain federal guidelines and regulations due to this classification. There are also local and state laws that have their own laws and regulations attached to public lending institutions.


Individuals and organizations that lend money and offer mortgages outside of those traditional financial institutions and outside of their regulations are classified as private lenders.

206 N Grant St

How Is Private Lending & Private Mortgages Different From Conventional Lending & Bank Mortgages

The primary functional difference between private loans and conventional loans or mortgages is how they are financially backed and how the terms are chosen.

When trying to get a loan from a conventional lending institution, including both banks and credit card companies, they are typically largely based on two decisions. Firstly, whether to fund you and which interest terms to fund you. That depends on your personal credit score and overall financial history.

In contrast, a private lender is going to make investment decisions based on the viability of the asset in play. So, for example, a private lender will consider the market value of the specific property that is in play for purchase. They will then consider how much equity will be invested in the property by the potential lender after the purchase. And then, build a projection model regarding the property’s future potential.


Different Funding Type

Because funding is tied to a physical entity, the property being funded, private lending is colloquially called “hard money lending.” This is not to say that hard cash is needed or exchanged (although it often is). But rather that there is a hard, physical property securing the loan. And not just any property; it’s the property or piece of real estate that is being funded. In other words, private lenders offer loans that are asset-based.

The second big difference between private lending and lending through a conventional financial institution has to do with the length of the term of the loan. Private lending is riskier for lenders as they don’t have federal protections backing them. To assuage this risk, they offer significantly shorter-term loans than traditional lending institutions.

How short? If you were to go into a bank to apply for Indianapolis real estate investing, they would typically offer a 15- or 30-year mortgage on a property, residential or commercial. In stark contrast, a private lender will typically structure their loans to be paid back within three to 24 months. To ensure a fast turnaround, interest rates average around 30%.

2947 S Fleming St

Why Should I Choose Private Lending When I Want to Take Part in Indianapolis Real Estate Investing?

If you are looking to finance your traditional commercial or residential Indianapolis property, then private lending probably is not right for you. That’s because private lending was not created and designed for long-term, conventional lending. That is as those types of loans already come with integrated advantages that private lending cannot compete with.

Instead, the gap that private lenders like Indianapolis’s Invest With Ben fill is with certain types of real estate investing. Private lending and private mortgages offer a unique and non-conventional funding source. That source can be the ideal type of funding in special circumstances.

Not sure if that means you? Consider the following two big reasons why a private lender may just be your ideal finance solution:


1. You need a real estate loan fast.

Public lending institutions must be available for public borrowing. But, they also have to ensure they are meeting certain regulations and following certain formalities. In short, public lenders have red tape, a lot of red tape, which requires the mortgage company to undergo a fair bit of paperwork. That is generally causing delays between when an individual file an application for a real estate business salon and the lender’s response. As to whether they can fund it, for how much, and with what stipulations.

Private lenders are not beholden to those same federal regulators. They are lending with their own money and, as such, are able to do so more on their terms. While they will want to do research into a piece of property, a private lender is able to mobilize much more quickly as it is the money they are lending, on their terms. Once a piece of real estate is evaluated and you have the green light, it’s pretty much straight to the races from there.

Additionally, if you are working with a real estate wholesaler as well as a private lender, which is exactly the unique umbrella that Invest With Ben falls under, you are working with someone who has already thoroughly evaluated the properties. In other words, the green light is there, and you, as an investor, can get started that much more quickly.

3931 N Bressingham Dr, Indianapolis, IN 46235

2. You want to focus on the asset and not your financial history.

Of course, a private lending group is going to look for borrowers with good credit ratings and financial histories. But, that is not where their primary focus is going to be. These are short-term loans that they want to get out of and get back as soon as possible. What’s more important is the value of the asset itself. So there should be a default, the asset itself has enough inherent value to protect against any significant financial loss.

In contrast, a conventional lending institution is extremely risk-averse. They are unlikely to bankroll an individual with a dodgy credit report or imperfect financial history. In fact, banks and credit unions place a lot of emphasis on personal finance histories. They are required to and will examine income histories, assets, credit scores, debt, missed payments, and collection histories. Plus, every other imaginable financial detail is available to them. The underwriting team for this type of institution is more often than not inflexible here. Thus, individuals may find such scrutiny loathsome and cumbersome even if they are certain to pass under it.

With a private lender, sometimes, a good story (backed by a good asset) is all you really need. Do you have the skills to complete a desirable house flip? Can you show the exciting viability of a big commercial real estate project? If so, then yours is a story a private lending group is apt to listen to and ultimately bankroll.

25 E 54th St

Take That Leap Into Indianapolis Real Estate Investing Through Invest With Ben

Here at Invest With Ben, we make money by helping our clients make money.

Our team is capable (and proven effective) of doing this because we buy real estate wholesale. Thus, we are able to offer it at a deeply discounted rate to investors with a passion for rehabbing and otherwise transforming that real estate into more valuable properties. Those properties can be then sold at good returns for everyone involved in the process.

But having the property available is only part of the puzzle. We not only are able to find you the right property, but our team at Invest With Ben also prioritizes private lending. You do not have to go through all the credit history hoops and financial history red tape required of a traditional financial institution. Instead, through us, we can get you the money you need fast so that you can get started on that big real estate flip as soon as possible.

Learn more about how we can get you invested in Indianapolis real estate investments by contacting us today!