The private lender is not dissimilar to a non-bank lender.
In fact, they’d fall into the same category generally, but a private lender could be a private person or their trust who typically have been successful in their business career and they invest their money by way of making loans to companies or individuals for their projects. At Ian Woods Mortgages, I have several private lenders who typically lend to people for business purposes secured by a mortgage on their homes. They would lend for property development or construction loans where banks criteria may be too strict to enable a transaction to proceed.
Often that’s the case with developers. The banks are quite strict in their criteria for development finance so a private lender would typically be a lot more flexible. They’re probably a little more expensive than a bank, but they enable the transaction to proceed without the strict criteria that a bank might enforce such as quantity survey reports or evaluations along the way during the project. So a private lender is a registered lender and they would lend on the basis of security that’s provided by the borrower and with more flexible terms than a traditional lender.