Real-Estate Investors Choose Speed Over Cost with Private Lenders

Private Lenders: A Real-Estate Investors’ Choice

• Despite higher interest rates, real-estate investors Mike Gorius and Kevin Hart choose private lenders.
• Private lenders outperform traditional lenders when it comes to speed and efficiency.
• Finding people with capital requires networking, leveraging social media, and cold-calling.

As of March 2025, mortgage rates are around 6.4%. Real-estate investors Mike Gorius and Kevin Hart are ready to pay nearly twice this rate to collaborate with private money lenders. Their main reason is speed and efficiency.

Gorius revealed that working with a traditional lender involves more paperwork and hurdles. He and Hart, who left their jobs to invest in real estate and achieve financial independence, specialize in wholesales, wholetails, and flips primarily in Louisville. They also own more than 20 rental properties, varying from short to long-term.

The Advantage of Working with Private Money Lenders

There are three main ways to borrow money in their industry: private money lender, hard money lender, or a traditional lender. Traditional lenders usually offer the lowest rates, while hard money lenders tend to be the most expensive. Currently, interest rates with private money lenders are between 10% and 12%.

Closing Deals Quickly with Private Money Lenders

Despite higher costs, private lenders can offer speed, which is crucial for Gorius and Hart, who close deals weekly. With their own inspections and off-market sellers willing to negotiate prices, they can purchase properties in days, not weeks. The fastest they’ve ever closed a deal was eight days, whereas a traditional lender would take at least 30 days.

When executing deals, they meet the seller, title attorney, and the bank virtually, as people are scattered across the US. They give an example of a standard deal in Louisville: a flip costing about $150,000 — $100,000 for the property and $50,000 for the renovations.

Finding Private Money Lenders

Finding private money lenders usually involves networking and cold calling. Gorius started with his 900 contacts. He texted everyone, inviting them to learn about investing in real estate. It’s a number game: out of 900, maybe nine people respond positively.

Another strategy Gorius uses is posting on social media and LinkedIn. In one post, he detailed his first flip, in which he doubled his money 10 weeks later. This post helped him raise $280,000.