There is no reason why you should feel ashamed if you have poor credit. This issue is more common than you might think, with roughly one-third of all Americans having less than desirable credit histories. Unfortunately, despite its prevalence, bad credit can still prevent you from getting where you want to be in life. Whether that means buying a house or buying a car, bad credit can and will be a nuisance. It will make you ineligible for a number of loans offered by financial institutions. So what are your alternatives at that point?

In most cases, you’ll need to visit a private money lender. But a lot of people don’t even know where to begin with private money lenders, let alone what they are. With that in mind, let’s demystify private money loans and understand what they have to offer.

What Are Private Money Loans?

Essentially, a private money loan is a loan that is offered by a private, sometimes individual lender rather than a major financial institution like a bank. A private money lender could be an organization rather than a single person, but it will not come with the same limitations (necessarily) as a traditional loan.

What Are the Advantages of Private Money Loans?

There are many benefits to choosing a private money loan. For one thing, private money lenders are able to follow their own vetting procedures. While there are many regulations that must be followed by banks and other financial institutions, private money lenders can make decisions based more on you as an individual. For this reason, bad credit won’t automatically turn off a private money lender. Private money lenders can further take into account your overall income and assets, and additionally will be able to make more customized deals for you.

Quite often, this also means that private money lenders are able to negotiate more with those that they are lending to. The borrowers should always be on time with their payments, but some private money lenders are more able to work with them when life happens.

What’s Next?

When selecting a private money lender, you should read reviews and be aware of the fact that you may need to consult with several before finding the right one. Just make sure that you’re making a responsible decision!