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private money lending | Insight Decision Cloud PaaS

Want to Grow Your Assets? Here Is Why Private Money Lending Is a Great Option

Some people only have a few they can turn to when finding themselves in financial binds or sudden crises. Medical issues not covered by insurance, vehicle repairs that are not covered by warranty; These everyday problems can be a hard financial hit to the majority of American consumers. 

 

Not everyone needs a little extra cash for emergencies; maybe someone is in between paychecks and needs immediate cash to cover bills, or maybe someone wants to take their children to a theme park for the weekend.

 

Life events that require extra (unplanned) cash, is stressful. For some borrowers, there is the added stress of bad credit and inability to borrow from the bank. Pay-day loans fit perfectly for such financial predicaments. Unlike larger financial institutions, private money lenders can remove all the red tape and streamline the lending process.

 

As a private money lender, you have the opportunity to make an investment, while promoting social responsibility within the lending industry. For those looking to grow their assets, private money lending is a great option.  

 

Private Money Lending Explained

In private lending, you can choose to lend your money to whomever you wish. And you can customize lending guidelines as you see fit.

 

The ROI of private money lending for payday loans is significantly higher than most loans. Which means, it’s a great option for first-time lenders who are getting started in the lending business. 

How To Become a Private Money Lender

It’s not uncommon for investors to recognize the benefits of becoming a private money lender.. If you are interested in private lending, check out some of the steps below. 

  1. Identify your preferred lending focus (who you are going to lend to primarily)
  2. Join a community of private money lenders or a peer-to-peer lending platform to find the best possible investments.
  3. Meet with an attorney to help you create a company structure.
  4. Learn how to evaluate potential clients by calculating the potential for returns versus risk.
  5. Establish your business and obtain the required licensing and insurance.
  6. Launch your private money lending business. 

How To Identify Ideal Borrowers 

There are some key qualities that may help lenders choose the ideal borrower, but it is very difficult to tell for sure if one borrower is more reliable than another. Additionally, the modern consumer is more complicated and harder to measure using traditional metrics. However, with the use of a decision engine platform, online lenders can be more confident in their borrower decision and mitigate risk. 

How to Mitigate Risk

Every private lending business faces a risk of losing money. However, private lenders have many tools at their disposal, which allows them to mitigate the risk of loss as much as possible. For example, our Decision Cloud software allows you to gain insight into borrower’s lives. 

 

Our revolutionary platform, Decision Cloud, collects data from various sources and translates it into a score for the borrower in question. This score is then used by you to determine how likely it is the borrower will repay the loan.

 

Insight processes over 500,000 consumer loan applications daily. Lenders have the ability to use additional Decision Cloud services, such as TruScore and TruFraud,to further mitigate risk by reducing fraudulent data in our private lending marketplace.


At Insight, we encourage our lenders to think outside the bubble. Specifically when figuring out ways to detect fraudulent activity in the marketplace and reconstructing their analytic models.

 

By using efficient and secure decision engines, lenders can not only limit financial risk, but open their eyes to a new and improved method of underwriting.

 

Using real-time data services, Decision Cloud allows users to create advanced scoring algorithms to regulate recently shopped leads, compare the production of data services and much more.

 

If you’re interested in getting into the payday loan business or already own and operate a private loan business, contact us today to learn more about Insight’s Decision Cloud and how it can help you lower risk while increasing your profits. 

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