Join date: Jan 18, 2022

Although it is not always true, private mortgage lenders are more likely to charge higher interest rates than traditional lenders. This can be because of the risk they are carrying by lending to the individual, to compensate for a lower down payment or poor credit score, or simply as part of their business model. It is not uncommon to see interest rates that are 3 to 5 percentage points higher than current mortgage rates.

Since the lenders are secured by real property, private lending can be a lucrative way to earn a higher return than they may be able to receive elsewhere while earning cash flow from the monthly mortgage payment.

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