Practical Tips for Securing Private & Non-Bank Loans in Australia

Private and non-bank lending can be a powerful strategic financing tool but it’s not always straightforward. Whether you’re a property investor, developer, buyer’s agent or business owner, getting the most out of private finance requires preparation, clarity and an understanding of what lenders prioritise.

This guide offers practical, actionable tips to maximise your chances of quickly securing private and non-bank finance in Australia from pre-application preparation to dealing with structures banks don’t support.

For definitions and basics on non-bank lending, see our complete guide on private lending in Australia.

1. Understand What Private & Non-Bank Lenders Really Look At

Unlike major banks, non-bank lenders place far greater emphasis on asset quality and exit strategy than on serviceability or traditional credit scores.

When preparing your application, focus on:

• The marketability and location of the asset

• Current loan-to-value ratio (LVR)

• A clear exit plan (sale, refinance, stabilisation)

• Purchase structure and timeframes

For detail on different loan structures that private lenders offer, see:

• First mortgage private lending

• Bridging loans

• Second mortgage finance

2. Prepare Your Documents Before Approaching Lenders

Having complete and organised documentation from day one can dramatically speed up approvals.

Suggested checklist:

• Contract of sale or letter of offer

• Proof of identity and company structure

• Latest valuation or council rates notice

• Current mortgage and encumbrance details

• Evidence of exit strategy (finance confirmation, sale plan, etc.)

Private lenders often issue indicative terms within 24–48 hours when documentation is complete.

3. Be Clear About Your Exit Strategy

Exit strategy is one of the most important factors private lenders consider.

Common exit strategies include:

• Refinance to a traditional bank once asset is stabilised

• Sale of the underlying property

• Cashflow or business performance improvements

• Completion of development or subdivision

A well-defined exit plan shows lenders that your borrowing objective is achievable — which increases confidence and reduces risk.

This is especially critical in scenarios such as short settlements and auction purchases, where timing is essential.

4. Use Valuations That Reflect Market Conditions

Private lenders place more weight on the marketability of the asset than banks do.

Tips:

• Use a valuation that reflects recent local sales

• Consider a second opinion for mixed-use or non-standard assets

• Ensure the valuer understands the local market

Accurate valuations can boost confidence and improve the loan-to-value ratio (LVR) a lender is willing to support.

5. Be Prepared for Different Structures: Not a One-Size-Fits-All

Private lending structures vary depending on:

• Asset type (residential, commercial, mixed-use)

• Loan purpose (acquisition, refinance, bridging, development)

• Exit strategy

Examples of structures you might encounter:

• Interest-only facilities

• Capitalised interest

• Second mortgages

• Mixed-security lending

Understanding these options helps you choose the best match for your needs.

For more on different structures, see:

• Development and subdivision loans

• Secured business loans

6. Communicate Your Plan: Not Just Your Numbers

Private lenders are people and businesses too — and they want to see a credible borrower story.

Effective communication includes:

• Explaining why you need the loan

• Demonstrating a clear plan to repay

• Clarifying risks and mitigations

• Showing industry knowledge (especially for commercial proposals)

A professional approach increases confidence and improves the chances of terms being issued quickly.

7. Be Realistic With Tailored Expectations

Private lenders price based on risk and time preference — that means:

• Rates may be higher than traditional bank products

• Terms are usually short to medium term (often 3–24 months)

• Fees for valuation, legal and establishment are common

But the value lies in:

• Speed of execution

• Flexibility of structure

• Ability to transact where banks cannot

8. Understand the Regulatory Landscape

Many private and non-bank lending scenarios in Australia are NCCP-exempt especially where the loan is for business or investment purposes.

This means:

• Consumer credit protections may not apply

• Documentation must clearly state business purpose

• Borrowers should seek professional advice where complexity exists

As always, ensure your legal and financial advisors are comfortable with the structure.

FAQs: Private & Non-Bank Loan Tips

What documents do private lenders need?

Typically: contract of sale, valuations, encumbrance details, asset information, and exit strategy documentation.

How fast can private lending be approved?

Indicative terms can often be issued within 24–48 hours if documentation is complete.

Can private lending be used for auctions?

Yes. Many borrowers use private lenders for auction finance and short settlement deadlines because of speed.

Are private lenders more expensive than banks?

Interest rates may be higher, but the value is in speed and structure, not purely cost.

Conclusion: Prepare First, Act Fast

Private and non-bank lending in Australia offers opportunities that traditional lenders often cannot match but success depends on preparation and clarity. By understanding what lenders look for and presenting a compelling, well-documented case, you increase your odds of quick approvals, better outcomes and transactions that close on time.

For deeper examples of how these tips apply to real scenarios, see our gallery of solutions such as private lending in Australia or bridging finance.