Private money is basically the savings of an individual or an organization. It can be their retirement savings or their investment savings etc... Private money is borrowing money from a private money investor or organization for your specific project. It’s a direct loan from a private investor to you or to your company without the traditional qualifications and official requirements. It’s having many more advantages as compare to other types of loans because it builds a very good relationship between a lender and a borrower. It takes your shorter time to fund your loans. Private money lenders give more control to a borrower over their loan, and private money loans generally have a shorter loan period than banks. And the very obvious advantage of this loan is that it allows the borrowers to be independent and to expand their businesses. It’s the safest way to invest your money, as a private money lender you are the bank, as a bank you have low risk about anyone because your money directly goes into an equity account.
In short terms, private money arrangements can provide very flexible and simple policies and this loan is very useful for start-up companies especially those with less than a perfect budget.