The plain definition
A private business lender is a non-bank lender that lends to businesses using its own money or private funds, rather than customer deposits. Because it isn't a bank, it sets its own lending approach. Most private business lenders focus on short-term loans secured over property, and they decide based on the security and the exit rather than years of financial statements.
Equity Tap Pty Ltd is a direct, independent private business lender lending its own money, Australia-wide. We lend from $50k to $5m for one to twelve months, secured by a first or second mortgage or caveat over Australian residential or commercial property.
How private lenders differ from banks and cash flow lenders
| Bank | Cash flow lender | Private secured lender like Equity Tap | |
|---|---|---|---|
| Main focus | Financials, serviceability, credit history | Bank statements and turnover | Property security and the exit |
| Security | Usually property | Often unsecured or a general security | First mortgage, second mortgage or caveat |
| Typical term | Years, often 20 to 30 | Months, with frequent repayments | One to twelve months |
| Speed | Commonly up to three months or more | Quick, but amounts are limited | Term sheet in about 30 minutes, eligible loans settle in as little as 24 hours |
| Documents | Years of financials | Bank statements | ID, property and mortgage details, purpose, exit |
| Repayments | Principal and interest | Often daily or weekly | Interest only, or up to six months prepaid or added |
For more on how unsecured cash flow lending compares, see cash flow loan alternatives.
When a private business lender makes sense
A private lender isn't a replacement for a bank when the bank can do the job in time. It makes sense when:
- Time is short. You need funds in days and a bank refinance commonly takes up to three months or more.
- The bank has said no. Because of credit policy, serviceability, ATO debt, defaults or a past decline.
- Your financials don't tell the real story. Returns aren't lodged yet, or a bad year is dragging down a strong business.
- The need is short. You need money for months, not decades, and don't want to restructure your whole borrowing.
- The deal is complex. Several entities, unusual security or a situation that doesn't fit a template.
How Equity Tap works
We're business owners lending to business owners, not bank people. We come from a business background and we understand small business. There's no credit committee: the person who answers the phone is often the person who makes the decision.
- We don't order a valuation before approval, so you save time and cost and aren't pulled away from the business to meet a valuer.
- We don't need tax returns, BAS, profit and loss, an accountant's letter or bank statements for a property-secured loan.
- There's no credit check at initial assessment. Bad credit history, defaults, ATO debt or a past decline are not automatically a problem.
- Interest for up to the first six months can be prepaid or added to the loan, so there are no scheduled payments in that period. Interest is not waived.
The full list of what we do is on our lending facts page.
What to look for in a private lender
- Do they lend their own money? A direct lender can decide faster than one that has to find a funder for each deal.
- Who makes the decision? If you can speak to the decision-maker, you get answers faster and fewer surprises.
- Is the full cost clear? You should see the full cost in writing before you commit. A term sheet is where that happens.
- Do they care about your exit? A responsible lender wants to know how you'll repay, and makes sure you understand it.
- Are they flexible on structure? First mortgage, second mortgage, caveat, interest prepaid or added.
Our longer guide on how to choose a private business lender covers this in more depth.
For example
For example, a business owner who has agreed to buy a competitor's business finds the bank wants three years of financials and a valuation, and won't commit for weeks. The vendor has another buyer waiting. A private lender secured over the buyer's home can fund the purchase quickly, and the buyer refinances to a bank once the acquisition is complete and the combined figures are available. Our guide on buying a business with fast finance covers this.
Pricing
Private lending usually costs more than a bank loan, because of the speed, flexibility and short term. That's why short-term matters: you only have the money for the time you need it. Each Equity Tap loan is priced on your individual circumstances, aiming for the sharpest rate available for your situation, with the full cost shown before you proceed.
Talk to a private lender today
Call 1300 123 024 or apply online. Learn more about Equity Tap or read why we're regarded as one of Australia's best independent private business lenders.
Business-purpose lending only. Approval, timing and terms depend on the scenario.
Frequently asked questions
What is a private business lender?
Is a private lender the same as a cash flow lender?
Why would I use a private lender instead of a bank?
Do private lenders check credit?
Is private lending more expensive than a bank?
Can a private lender lend for personal purposes?
Is Equity Tap a direct lender?
Brokers: send the scenario through the Equity Tap broker channel and you will deal with the same lending team.