What Is Private Money in Real Estate—and How Is It Different From a Private Lender?
January 2, 2026
Private money refers to individuals—not lending companies—who invest their personal capital by lending directly to real estate investors. These individuals may be friends, family members, or private investors looking for returns outside traditional investments.
Unlike private lenders, private money lenders:
- Do not operate as formal lending institutions
- Typically lack underwriting teams, servicing systems, or draw administration
- Often lend on a relationship-based or deal-by-deal basis
Private money can be useful for certain scenarios, but it often comes with limitations around scalability, consistency, and structure.
Private lenders like Lend Investors Capital offer the professionalism, reliability, and compliance of a full lending platform—without sacrificing the flexibility investors seek.
