The common wisdom is that there is always something good that comes out of bad situations. That appears to be the case in the lending sphere. Despite the loan and high-yield markets gradually reopening the markets have not fully recovered to syndicate deals with competitive terms, as seen prior to the pandemic. This has created a great opportunity for private lenders to pick up larger borrowers, which are in need of liquidity to keep their business afloat.
Clearly, it’s an unprecedented opportunity for private lenders to further disintermediate the investment banks and entrench themselves as an alternative option for larger transactions now, as the bond and loan markets are still in recovery. The key advantage for private lenders in the current crisis is to provide much-needed certainty to borrowers.
COVID-19 is acting as an accelerant for private lending growth. One of the great attributes of this market is that private lenders offer certainty in terms and financing is much less contingent on the credit ratings. Add to this the fact that fundraising in the private lending markets has been booming over the last few years, and you have the perfect storm for a private lending boom. When private lenders are able to raise larger funds, it naturally follows that they are now able to provide a larger amount of capital for larger borrowers.
The Rules of Thumb blog from MoneyThumb is quite sure private lenders are not glad that Covid-19 came along since it is actually providing unexpected opportunities for them, but there is nothing wrong with finding a silver lining in any cloud. We have many upstanding private lenders who use our PDF financial file converters specifically designed for their use, and we are sure they would be the first to tell you that they are just as concerned about the coronavirus as the next person. However, when opportunity knocks, we all open the door.
To understand private lending better and see what experts predict for the future of private lending, we'd like to suggest that brokers, borrowers, and lenders attend this free live and interactive webinar on Friday, July 31, 2020. The webcast is titled Private Lending 101: What You Need to Know and is provided by The Adviser. Below is a description of what will be discussed in the webinar:
With the lending landscape changing rapidly and risk appetites and serviceability policies constantly changing, some borrowers are being left out in the cold.
Join The Adviser for this free-to-watch live webcast where we discuss private lending and key private lenders that brokers need to know about.
This webcast will outline how private lenders are filling a void for specific borrowers, what product brokers can write through them, and how to write a deal with a private lender.
Join us and a panel of industry experts as we deep-dive into:
- Why are brokers turning to private lenders within this current climate to deliver solutions for their clients?
- How do private lenders structure debt differently to other financial institutions?
- Who is the “typical” private lending client?
- Where do private lenders source funds and why is this a huge advantage in funding certain scenarios?
- When is a private lender a must for certain situations?
- What products are typically available, how are they priced and how are broker commissions structured?
And much, much more!
This webcast is live and interactive. Watch live for CPD points and have your questions answered by our leading panelists!
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