Private money lenders provide financing sources for real estate market lenders. Individuals or groups of lenders count on high rates of return, and they make loans to people with bad credit.
Only in California this business was worth many billion dollar, before big banks like Washington Mutual and Countrywide got into the act. In 2007 privately funded loans market in California was worth $3.3 billion.
This year many privete lenders is fielding inquiries, and the number is higher than last year.
In this way of lending the most important is equity in the property to secures the loan and assurance that borrowers repay on time, lenders don’t mind credit scores.