Private lending can be a goldmine for real estate investors, but it’s also full of pitfalls. Some lenders have habits that can quietly drain your profits, create headaches, or even put your deals at risk. 

In this episode of Growing the Money, Rich Lennon highlights seven common practices from other private lenders that make him cringe and that every borrower should be aware of. If you’ve ever felt unsure about a lender’s motives or wondered whether you’re getting a fair shake, this episode is your roadmap to spotting red flags early and partnering with lenders who are upfront, fair, and trustworthy.

You’ll Learn How To:

• Spot junk fees like application fees, origination fees, and prepaid points
• Avoid lenders who force you to use their attorney or charge construction draw fees
• Catch tactics that quietly raise a lender’s real return
• Recognize pushy marketing moves at meetups and events
• Work with lenders who are upfront and fair about costs and terms
   

Who This Episode Is For:

• Borrowers using private money for real estate deals
• Investors who want to understand how lenders really make money
• Anyone looking for cleaner, more transparent lending relationships

Why You Should Listen:
Private lending isn’t just about rates and points. It’s about trust, transparency, and knowing who you’re really working with. Hidden fees, unnecessary requirements, and sneaky tactics can quietly eat into your profits. These seven warning signs help you spot trustworthy lenders, avoid being nickel-and-dimed, and make smarter, safer decisions for your real estate deals.

What You’ll Learn in This Episode:

[00:00] Seven things that some bad lenders do and why it’s worth calling out

[00:44] The problem with application fees draining borrowers

[02:29] How forcing borrowers to use the lender’s attorney backfires

[03:23] Why origination fees hide the real loan cost

[04:14] The trick behind prepaying points to boost lender profits

[05:12] How aggressive meetup tactics reveal pushy lenders

[06:13] The hidden expense of construction draw fees

[07:18] Why borrowers shouldn’t pay lender wire transfer fees

[08:05] How trust matters more than rates or points

Follow Rich Lennon here:
Website: https://richlennon.com/
Facebook: https://www.facebook.com/rich.lennon.121
Instagram: https://www.instagram.com/richlennon92/