The Top Moves to Get Started in Private Lending Right Now
How to lend with clarity, not chaos—in a market full of noise
Everyone’s talking about a crash. A recession. A correction. A collapse. And while some of that might be true, here’s what’s more important:
If you believe the market is shifting, what are you actually doing about it?
Because sitting on cash in the bank? That’s not safety. That’s stagnation.
If you're a cautious investor or new private lender watching from the sidelines, this market isn't a warning. It's an opening.
Let’s talk about how to move—strategically, safely, and on your terms.
What’s Actually Happening in the Market
In Q1 2024, 34% of banks reported tightening lending standards for multifamily properties. 31% reported tightening for nonresidential properties.
That trend hasn’t reversed.
And as banks continue to pull back, private lenders are stepping in to fill the void. Investors are reporting lines of credit have dried up, business credit card stacking is getting denied, and more.
But let’s be clear: that doesn’t mean going rogue.
It means doing what banks can’t:
Move quickly
Remain flexible
Maintain discipline
This moment doesn’t reward speed. It rewards balance.
5 Tactical Moves to Start Lending With Clarity
These aren’t high-risk hacks. These are battle-tested principles, designed to protect your capital and put it to work with confidence.
1. Start With a Clear Framework
Before you ever see a deal, decide what you want to lend on.
Ask yourself:
What types of projects do I lend on?
What’s my maximum loan-to-value (LTV)?
What are my red flags and deal-breakers?
Your lending criteria is your filter. Without it, everything looks “kinda good.” With it, you instantly spot the right fit.
2. Build Flexibility Into a Framework That Holds
Flexibility doesn’t mean inconsistency. It means you understand your standards well enough to know when they can bend—and when they absolutely shouldn’t.
Example: Say your LTV max is 80%. If someone bought a property at 50% of its current market value, the equity is already built in. If your rule is meant to protect you via equity, that box is checked—even if the structure looks different.
If the rule is about the borrower having skin in the game, then it still might be a pass.
As I’ve shared in conversation with other investors:
"If the rule is in place to ensure the borrower has skin in the game, stick to it. But if it’s to protect against downside risk, and the asset itself provides that, the exception may be logical—if documented."
In other words: Your standards can bend. They just shouldn't break.
3. Prioritize Asset-Backed Lending
Private lending means lending to the deal—not just to the person.
Asset-backed lending protects you with real, tangible value. It gives you leverage. It reduces your downside risk.
Benefits of asset-backed lending:
You can underwrite the deal, not just the story
You’re protected by real property value
You have a stronger position if something goes wrong
Not all real estate is created equal. But smart, conservative underwriting with solid collateral? That’s where real security lives.
4. Document Like It’s Going to Court
This isn’t about paranoia. It’s about precision.
Whether you’re lending to a longtime partner or a new operator—everything needs to be in writing. Every agreement. Every clause. Every what-if.
Your documents should clearly include:
Loan amount and repayment schedule
Use of funds (get this in writing—don’t leave it open-ended)
Collateral details and how the LTV was calculated
What happens in the event of default
Exit strategy, communication cadence, and any extensions
And yes—include fraud acknowledgments.
This protects both parties by affirming that all information is truthful and material misrepresentations could constitute fraud.
And don’t just take a borrower’s word for experience—verify it.
Ask for:
Deal history (past and current projects)
Actual HUDs from closed transactions
But even more important: What was the spread?
Did they make $200K on paper and walk away with $20K? Did they make money, or did the deal just close?
Understanding the real numbers is what separates surface-level due diligence from smart underwriting.
Anyone can close a deal. That doesn’t mean they profited—or that they managed risk well.
You’re not just protecting your capital.
You’re protecting your peace. And that starts with documentation.
5. Lead With Process, Not Panic
This is where most people slip.
They freeze—like the banks—or chase returns with no plan.
Neither approach is leadership. Both are reaction.
This market doesn’t call for panic. It calls for clear, calm frameworks.
So:
Lend with intention
Lend with clarity
Lead with process—not with FOMO, not with urgency, not with vibes
Don’t Try to Be the Bank. Be Better Than the Bank.
Banks are slow, overregulated, and trapped in bureaucracy. You’re not.
You can move with speed and flexibility—but only if you're also anchored in structure.
This isn’t just a window of opportunity. It’s a chance to define how you lend—safely, clearly, and on your terms.
Because if you're going to put your money to work, you may as well build something meaningful with it.
