Using a private or non-bank lender doesn't mean something has gone wrong. Sometimes the transaction simply requires a different type of lender.
BleuHaven arranges private and non-bank finance where timing, property, documentation, complexity or credit policy makes conventional bank lending unsuitable.
The important question isn't only whether the finance can be obtained. It is also what it will cost, how long it is needed for, and how the client gets out of it.
Private lending isn't only for borrowers experiencing difficulty. It can also be a commercial tool for otherwise strong borrowers where speed, timing or complexity is the issue.
It usually sits alongside the rest of a client's lending rather than replacing it, and it is often discussed in the same conversation as business and commercial finance or low doc and alternative income verification .
Getting the loan is only half the strategy
With private and short-term finance, one of the most important questions should be answered before the loan begins: how does it end? The exit might involve:
Refinancing to a traditional lender
Building sufficient trading history
Completing a development
Selling an asset
Improving the loan-to-value ratio
Finalising financial statements
Reaching another financial milestone
We want to understand that pathway before the client commits. The exit strategy isn't a formality. It can determine which lender, loan term and structure are appropriate in the first place.
Where private and non-bank lending can fit
These are the circumstances in which private and non-bank finance most often comes up. Whether a particular transaction can be funded, and on what terms, depends on the lender, the security and the individual application.
Time-sensitive settlements
Time-sensitive property settlements, including bridging between a purchase and a sale.
Property and structures outside standard bank policy
Commercial property outside standard bank policy, and complex ownership structures.
Incomplete or non-standard financial information
Transactions where the financial information available is incomplete or non-standard, and a conventional assessment cannot yet be made.
Business contracts and opportunities
Funding a new business contract, or a business opportunity with a tight deadline.
Temporary cash-flow requirements
Temporary cash-flow requirements, where the need is defined and the end point is understood from the start.
Credit circumstances outside mainstream appetite
Credit circumstances outside mainstream lender appetite where the underlying position remains sound.
Understanding the true cost
The interest rate is only one component of private lending. Depending on the facility, costs can also include:
- Establishment fees
- Valuation costs
- Legal fees
- Line fees
- Minimum interest periods
- Exit costs
The right comparison is therefore not simply what the rate is. It is what the finance costs in total, and what having access to that capital allows the client or the business to achieve.
Private finance with an exit in mind
Alternative finance can be a useful stepping stone. It can provide the bridge between where a transaction or a business stands today and where it may stand in six or twelve months.
Our role is not simply to arrange that bridge. It's to understand where it is supposed to lead.
A recent client engagement
A short-term facility taken deliberately, then replaced once the trading record supported a conventional one, is the pattern this page describes. A retail business did exactly that after closing two of its three stores. The engagement is published in full, with the others, on our business and commercial finance page.
Before you rely on any of this
The information on this page is general in nature and does not take into account your objectives, financial situation or needs. It is not financial, legal or taxation advice.
Private and non-bank finance is not suitable for every borrower or every transaction, and it generally comes at a higher cost and over shorter terms than conventional bank lending. All lending is subject to lender assessment and individual credit criteria, and no application is guaranteed. Costs, terms and lender appetite vary and change, so the figures relevant to a particular facility should be confirmed at the time.
