Private funding
Short-term private and non-bank funding, arranged through lenders that write this kind of loan
Oakwood Finance arranges short-term private and non-bank funding, including first and second mortgages, bridging and development finance, through lenders that write this kind of loan. It is expensive money, so we start with how and when the loan will be repaid. We compare it with bank options first, and the lender decides whether it will proceed.
What we do
Private funding is arranged around the exit, so we start there: how the loan will be repaid, when, and on what evidence. We then compare private lenders on the term, the fees and how interest is charged, and prepare the application with the valuation and security details they ask for.
What to weigh before you proceed
- The full cost over the term, including establishment and exit fees and any early repayment charge, set out in dollars rather than as a headline figure.
- The exit: a dated, evidenced plan such as a sale or a refinance.
- The alternatives: where a bank facility would do the job, we say so.
Each private lender assesses the loan on its own criteria.
Expensive money, used deliberately
Private lending is short-dated, security-backed funding from a non-bank source. It is usually more expensive than a bank facility and that is not a flaw: it is the price of speed and of a lender who will look past a story a credit template cannot process.
It is the right tool in a narrow set of situations and the wrong one in most others. We will tell you which you are in.
When it earns its cost
When the cost of not transacting is higher than the interest. A settlement that will otherwise fail and forfeit a deposit. A purchase that has to complete before a sale can. A development that needs to start before a bank’s conditions can be satisfied. A tax or ATO position that has to be cleared before conventional refinancing is even possible.
In each of those the question is not “is this rate high?” (it plainly is) but “what does the alternative cost?” Sometimes the alternative costs far more.
When it is the wrong answer
When it is being used to postpone a problem rather than bridge to a solution. Private funding without a credible, dated exit is how people lose the asset. Before we arrange anything we want the exit in writing: the sale, the refinance, the receivable, with a realistic date and evidence behind it. If the exit is “something will turn up”, we will decline the work.
What it actually involves
Terms are usually short and vary by lender. Interest is often capitalised or prepaid rather than paid monthly. Establishment and line fees are higher than a bank’s and there may be an exit fee. Valuations are conservative and lending ratios lower. Enforcement can be faster and less forgiving than a bank’s, which is exactly why the exit matters.
How we have structured it
A transaction arranged by Oakwood Finance. No client, site or lender is named. This is general information only, not credit assistance, a quote or a recommendation, and no outcome is implied for any other client. Every structure depends on individual circumstances, lender credit policy and approval. Oakwood arranges credit through its lending partners; all lending is subject to lender assessment and approval.
Case study · Private funding for a 35-lot Sydney development
Finance for a subdivision, with construction on selected blocks
Project: subdivision into 35 lots, with construction on selected blocks · Structure: private funding
The situation. A Sydney property developer engaged Oakwood Finance to secure funding for a subdivision into 35 lots, with construction required on selected blocks.
The complication. The project needed finance that accommodated both the subdivision and the construction component.
What we did. Oakwood Finance helped the developer obtain private funding aligned with these requirements, supporting the next stage of the development.
The outcome. Finance secured for a substantial residential project, with a funding approach suited to its scope.
Before you take short-term money
The guide covers what private funding actually costs, the narrow set of situations where that cost is worth paying, and the exit evidence we will ask for before arranging anything.