What Private Lenders Really Look For in a Real Estate Deal

Most real estate investors focus on selling the property—but private lenders fund the deal. That distinction matters.

You might have the perfect house in the perfect neighborhood, but if you don’t package the deal properly, your funding request could still get rejected. Why? Because lenders don’t fall in love with granite countertops or location. They care about numbers, strategy, and risk.

In this post, we’ll break down exactly what private lenders look for when deciding whether to fund your deal, the “3-second sniff test” that makes or breaks your pitch, and how to package your deal like a pro.

If you want faster approvals, better terms, and consistent access to capital, this is the checklist you need to hit.

How to Leverage Private Lending to Scale Your Real Estate Portfolio Faster

1. The Core Priorities of Private Lenders

Private lenders aren’t banks—they move faster and operate with more flexibility, but they still follow a mental checklist to protect their capital.

Here’s what they care about most:

✅ After-Repair Value (ARV)

What it is: The projected market value of the property after renovations.

Why it matters: ARV determines how much the lender can safely fund. Most private lenders cap at 65-75% of ARV to stay protected.

What they want to see:

• Solid comps from the same neighborhood
  

• Conservative ARV estimates (don’t oversell)
  

• A clear plan for how you’ll reach that ARV with your rehab
  

✅ Exit Strategy

What it is: Your plan for repaying the loan—whether you’re flipping, refinancing, or selling.

Why it matters: Private lenders want to know how and when they’ll get paid back.

What they want to see:

• A realistic timeline for renovation and resale/refinance
  

• Clear numbers to back your exit (sales comps or refinance LTV)
  

• A backup plan if the market shifts (e.g., convert to rental)
  

✅ Borrower Track Record

What it is: Your history of successful deals or a credible team behind you.

Why it matters: Lenders bet on the operator just as much as the asset.

What they want to see:

• Past projects with timelines, profits, and photos
  

• A capable team (GCs, property managers, agents)
  

• If you’re new: mentors, partnerships, or professional experience that builds trust
  

✅ Risk Mitigation

What it is: How you’ve planned for what could go wrong.

Why it matters: Every deal has risk—what matters is how you’ve accounted for it.

What they want to see:

• A 10–15% contingency buffer in your rehab budget
  

• A solid insurance plan (vacancy, construction, liability)
  

• An honest breakdown of potential risks and how you’ll handle them
  

2. The “3-Second Sniff Test”

Every lender has a built-in radar. Within 3 seconds of glancing at your deal, they’ll either lean in—or move on. Here’s what they subconsciously look for first:

1. Do the Numbers Make Sense at a Glance?

• Are the purchase price and ARV realistic?
  

• Is the rehab budget reasonable for the value increase?
  

2. Is the Deal Packaged Professionally?

• Is your pitch clean, organized, and easy to understand?
  

• Are photos, comps, and projections included in one clear document or deck?
  

3. Does This Person Seem Credible?

• Did you present your deal like a business owner or like someone winging it?
  

If you fail the sniff test, your deal may never even get read in full—even if it’s good.

3. How to Package a Deal to Check Every Lender Box

This is where most investors mess up. The deal might be fundable—but the way it’s presented kills the lender’s interest.

Here’s how to make your deal instantly more appealing:

1. Start With a One-Page Deal Snapshot

Summarize key details right at the top:

• Property Address
  

• Purchase Price
  

• Rehab Budget
  

• ARV (with 2-3 comp links)
  

• Loan Request
  

• Exit Strategy & Timeline
  

Think of this as the deal’s resume. Make it skimmable.

2. Include a Clean Financial Breakdown

Break down the full numbers in a table:

Item

Amount

Purchase Price

$200,000

Rehab Budget

$40,000

Holding Costs

$10,000

Total Investment

$250,000

ARV

$325,000

Estimated Profit

$75,000

This lets lenders quickly verify the ROI and make a decision.

3. Add a Renovation Scope

A simple bullet-point scope of work builds credibility fast. Show the lender you’ve planned the project, not just guessed the rehab number.

Example:

• New roof
  

• Kitchen remodel (mid-grade finishes)
  

• Paint, flooring, and landscaping
  

Bonus: Include photos of the current condition and design inspo or comps showing the finished look.

4. Attach Sales Comps and Market Data

Don’t just say your ARV is $325K—prove it. Include:

• 2–3 sold comps (same zip, size, style)
  

• Days on market
  

• Price per square foot comparison
  

Make it easy for the lender to nod and say, “Yup, that checks out.”

5. Position Yourself as a Pro

You don’t need 10 flips under your belt—but you do need to sound like someone who gets deals done.

Include:

• A short paragraph about your background
  

• Your team (GCs, realtor, mentor)
  

• Any past projects, even if they were small
  

Confidence matters. If the lender believes you’ll execute, they’ll be more likely to fund the deal.

Conclusion

Private lenders aren’t looking for perfection—they’re looking for preparedness, clarity, and confidence.

If you present a deal with a solid ARV, realistic numbers, a smart exit, and a clean pitch, you’ll stand out from 90% of other investors.

At My Verified Investor, we connect serious real estate investors with private lenders who are actively funding profitable deals.

Want your next deal funded faster? Sign up today and get connected to the right lenders—so you can scale your business with confidence.