- Last Updated: 13 May 2026
Private Lending in Australia
Get finance with transparent rates, from proven lenders, settled in the timeframe you need.
- Get funding when bank lending is not possible
- Access funding for complex or urgent scenarios
- Unsecured private lending solutions available to trading businesses
- Lines of credit and term loans available
- Approvals within 24-48 hours*
Get a Private Loan with Dark Horse Financial
1
Contact Our Team
Fill out our online form to apply for a private business loan. We’ll get in touch with you fast to understand your situation and make a recommendation.
2
Submit Application
We’ll expertly handle your application from start to finish. Private lenders can approve some types of finance within 24-48 hours.
3
Get Funded
Once approved, documentation is signed electronically, making settlement fast. Once settled, the funds will be disbursed to your account, or a line of credit will be made available to you.
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What Is Private Lending?
Private lending in Australia refers to loans provided by non bank lenders, like private individuals, privately owned businesses, specialist finance firms, or contributory funds with an investor base. Private lenders don’t have to follow the same rigid regulations as banks. This lets them be less conventional with how they set up loans and assess risk.
Private lending in Australia is often used by businesses that:
- Do not qualify for bank loans due to credit history, lack of financial records, or unconventional income.
- Require fast access to funds for time sensitive opportunities.
- Need short term financing solutions, such as bridging finance or caveat loans.
Private lenders used to charge higher interest rates and fees than banks, but due to competition in the private lending space, rates have improved significantly compared to the past, and many lenders offer loans with more features.
What You Can Do With Private Business Financing
Private loan lenders can help you secure funding for a wide range of purposes, including:
Covering Cash Flow Gaps
For businesses with seasonal revenue or those with fluctuating income, private loans can provide much-needed funds to cover temporary cash flow gaps.
Obtaining Working Capital
Manage day to day operations or cover unexpected expenses with fast access to working capital, ensuring your business runs smoothly.
Fueling Business Expansion
Debt Consolidation
Bridging Finance
Need short term funding to cover a gap between investments? Private lending is ideal for bridging loans, giving you temporary financing until long term funding is secured.
Types of Private Lending
1. First Mortgage Loans
The first mortgage loan is the primary loan that is backed by a piece of property. In the private lending market, first mortgages are often used when a borrower can’t get a bank loan or needs to settle faster than banks can deliver.
Most of the time, private first mortgages are approved faster than traditional bank loans. The lender’s main concerns are the value of the property and the borrower’s plan to pay back the loan. Private lenders are usually more flexible than banks, which focus on credit scores and detailed financial records. As long as there is enough equity and a clear exit strategy, private lenders are willing to provide funding.
People often use these loans to buy property, pay off existing debts, or put money into a business that is growing.
2. Second Mortgages
A second mortgage loan is backed by a property that already has a first mortgage on it. The private lender puts a second charge on the property in this arrangement. This means that if the property is sold, the first lender will get paid back first, and the second lender will get paid back with any funds left over. Because they are in a lower position, second mortgages are seen as riskier, which usually means that borrowers have to pay higher interest rates and fees.
These loans can be a good option for business owners who need to get equity without changing their current first mortgage. A second mortgage is a quick way for borrowers to get more money without having to go through the long process of refinancing with their main lender. People often use this type of loan to pay for various business costs, get working capital, or take advantage of an opportunity.
3. Unsecured Private Loans and Lines of Credit
Unsecured term loans and lines of credit are now available from private lenders. A term loan provides a lump sum that you pay with interest over time. A line of credit allows you to draw from a pre determined credit limit and you pay interest only on what you use.
These are available to trading businesses that can demonstrate they can service the loan. Assessment is done via a read only view of business bank account statement for loans up to $250,000. For unsecured loans larger than that, full financials and other usual documents are required.
4. Private Business Loans
Private lenders can give private business loans to businesses that don’t meet the requirements for bank loans or need funds quickly. Private business loans are different from traditional bank business loans in that they don’t usually require detailed financial statements or a strong credit score.
You can use property or business assets as security for these loans. In some cases, private business loans can also be a bridging solution, helping a company pay for urgent expenses until it gets longer term funding. A clear exit strategy is important for all types of private lending.
5. Caveat Loans
In Australia, caveat loans are one of the quickest and most flexible types of private loans. A caveat is put on the title of a property, which means the owner can’t sell or refinance the property until the loan is paid back. This gives the lender peace of mind without having to go through the more complicated process of applying for a mortgage. Caveat loans can be approved and settled very quickly, usually within a few days, because the registration process is simpler.
The goal of these loans is to be short term, usually lasting between one and twelve months. They are best for urgent funding needs like getting cash flow back on track, paying taxes, or taking advantage of business opportunities that need to be acted on quickly. Caveat loans usually have higher interest rates than regular mortgages, and terms are much shorter, so having a sound exit strategy is key.
6. Lines of Credit Secured with a Second Mortgage
In addition to traditional loan structures, some private lenders now offer revolving lines of credit secured by a second mortgage.
This type of loan works like a regular line of credit, but it is backed by the equity in a property, and the lender registers a second mortgage on the title. The borrower can take out funds as needed, pay it back, and then take out more money, which gives them more freedom than one time loan structures.
This kind of facility is especially useful for business owners because it lets them get cash whenever they need it without having to apply for a new loan. You can use it to deal with seasonal changes in cash flow, pay for operating costs, or help your business grow.
Benefits of Private Loans
- Variety of Options: There are plenty of secured and unsecured private lenders that can offer different loan products to suit your needs.
- Flexible Loan Terms: Private loans can be structured to suit your specific needs, including shorter or longer repayment terms.
- Fast Approvals: Private lenders typically have quicker approval processes, allowing you to access funds when you need them most.
- No Red Tape: Avoid the lengthy documentation requirements and approval processes of traditional bank loans.
- More Flexible Lending Criteria: Private lenders are more willing to lend to those with poor credit histories, making it an accessible option for business owners.
Who Can Benefit from Private Mortgages in Australia?
Businesses with Short Term Cash Flow Needs
If your business needs a quick cash injection to cover expenses, address emergencies, or take advantage of a time sensitive opportunity, private lending offers the funding you need.
Companies with Unique or Complex Financial Situations
Businesses that don’t meet the rigid criteria of traditional lenders due to poor credit, irregular income, or other challenges can benefit from private lending.
Startups and Growing Businesses
Access the capital you need to grow, even if you haven’t been operating long enough to meet the requirements of banks.
Key Differences Between Private Loans and Bank Loans in Australia
Speed of Approval
- Private Lenders: Can approve and release funds within days, sometimes within 24–48 hours.
- Banks: Can require up to weeks of review due to compliance checks, systems processes and detailed financial assessments by internal Risk teams.
Eligibility Requirements
- Private Lenders: More flexible, may lend to businesses with poor credit or incomplete financial records.
- Banks: Require strong credit history, detailed documentation, and consistent, demonstrable profitability.
Loan Costs
- Private Lenders: Many private lenders now offer better rates than before due to competition in the private lending space.
- Banks: Usually offer low interest rates for loan products.
Loan Structure
- Private Lenders: Tailor loan terms to suit individual borrower needs, including short term or interest only arrangements.
- Banks: Offer more standardised loan products with less flexibility.
Risk Assessment
- Private Lenders: Focus less on credit score and more on the borrower’s general asset position and exit strategy for the loan.
- Banks: Place greater emphasis on proof of income serviceability and credit score.
When to Choose a Private Lender Over a Bank in Australia
Business owners may choose private lending in situations such as:
- Urgent need for funding where waiting weeks is not practical.
- Difficulty meeting a bank’s strict criteria due to credit score or income documentation.
- Short term financing needs, such as bridging finance during property transactions.
- Opportunities requiring fast action, such as purchasing discounted stock or funding a time sensitive project.
Banks may still be the better choice when:
- The business meets the eligibility requirements and can access low cost finance.
- Long term funding is needed with predictable repayment schedules.
- Borrowers want the security and protection that come with regulated financial institutions.
Is Private Lending Right for Your Business?
Before you apply for a private loan, you should think about the following factors:
What's your business like?
Banks may not be able to give funds to businesses that don’t fit into traditional moulds. Private lending might be a good option for you if your business is new or seasonal.
How urgently do you need funds?
Private loans are usually faster and more flexible than loans from banks, which makes them great for situations where time is of the essence. Private lending lets you get money quickly if you need it for working capital, emergencies, or limited business opportunities.
How good is your credit?
If your credit score is low or you don’t have much credit history, traditional banks may not be willing to lend you money. Most private lenders don’t usually check your credit score; instead, they look at the value of the security and how likely you are to pay off the loan at the end of the term. Unsecured private lenders do check your credit file, and some will refuse based on history (e.g. any existing defaults to other lenders).
What are your exact goals?
If you need short term loans to reach certain goals, like buying equipment or investing in an opportunity, private lending might be a great option if there’s a clear exit strategy.
Case Study
$1.1M Private Loan to a Commercial Construction Business
A commercial plumbing business came to us after the impact of COVID left them with reduced contracts, delayed payments, and a heavy debt burden.
As trading conditions improved, the business regained strong turnover and cash flow. However, they were still carrying expensive self sourced loans and had accumulated $1 million in tax debt, which was putting ongoing pressure on cash flow.
An unsecured loan was initially considered, but due to losses recorded during the pandemic, this was not a viable option for the required $1.1 million facility.
The solution
We structured a $1.1 million first mortgage loan secured against property.
To further support cash flow, the interest on the loan was capitalised. This meant the business was not required to make ongoing interest payments, allowing them to focus on stabilising operations and addressing their tax debt.
The outcome
The new structure allowed the business to consolidate existing debts, reduce immediate repayment pressure, and avoid potential ATO enforcement action.
By freeing up cash flow, the business was able to focus on recovery and growth, with a clear pathway to refinance into a lower cost facility once financial performance continues to improve.
The Private Lending Space and The Importance of Lender Selection
Private lending in Australia operates very differently to bank lending. It is not regulated in the same way banks are, which means there is a wide variation in how lenders set rates, structure loans, and enforce terms.
Some private lenders offer well structured loans with fair pricing and clear terms. Others apply high fees, aggressive default provisions, and conditions that can create pressure if your situation changes.
Because of this, lender selection is critical.
Choosing the wrong lender can lead to higher costs, restrictive terms, or challenges if you need more time or flexibility. Choosing the right lender means securing the amount you need, with favourable rates and terms, and within the timeframe required.
We work closely with a network of private lenders across Australia and understand how each one operates. This allows us to connect you with lenders who have a track record of settling similar deals, offering competitive rates, and applying policies that are commercially reasonable.
Contact our team today to get started.
Ready to Explore Private Lending Options?
Private lending offers your business the flexibility, speed, and support it needs to succeed. We’ll connect you to the right private lenders across Australia. Contact us today for a free consultation.
Private Lending FAQs
Private lending is a type of financing that comes from non bank sources, such as individuals or private companies, offering more flexibility in terms of loan structure, approval process, and eligibility requirements than traditional lending. Private lending is not regulated like consumer lending is, so lender selection is important.
Yes, private lending through reputable lenders is a safe and legitimate way to secure financing, but there are predatory lenders to avoid. It’s important to work with experienced professionals like Dark Horse Financial to help you access reputable private lenders in Australia.