Referring a deal to a private-money lender can be the right move for a file that doesn’t fit conventional guidelines — but a referral is still a professional decision, not a reflex. Before you make the introduction, these five questions are worth running through.
1. Does This Deal Actually Fit a Private-Money Lender?
Not every declined deal belongs in the private-money lane. Take a minute to look at why the deal didn’t fit conventional financing — timeline, property condition, borrower profile — and whether that specific reason is something a private lender would actually be positioned to work around. For the deeper distinction between keeping a deal and handing it off, see our refer vs. originate breakdown.
2. Is This Lender Actually Vetted?
A referral is only as good as the lender behind it. Before sending a client anywhere, know the lender’s track record: how they’ve handled similar deals, how transparent their terms are, and whether other brokers or loan officers in your network have real experience working with them.
3. What’s Permitted Under My Brokerage or Employer’s Policy?
This is the step that’s easiest to skip and the most important not to. Referral rules — and what compensation, if any, you’re allowed to accept for one — vary by brokerage, employer, and state. Confirm this before you make the introduction, not after.
4. What Does the Compensation Structure Actually Look Like?
If compensation is part of the arrangement, understand exactly how and when it gets paid, and get it in writing. Verbal understandings about referral fees are where most disputes start.
5. What Happens After the Introduction?
Making the introduction isn’t always the end of your involvement. Know whether your client will keep you updated as the deal progresses, and whether there’s an expectation that you stay involved through closing.
Where PMB Network Fits In
These questions get easier to answer once you’re not figuring them out alone. PMB Network gives brokers and loan officers access to a vetted lender rolodex, live Scenario Desk calls to work through real deals like this one, and Support Desk Q&A for exactly this kind of judgment call. Membership is $79/month, cancel anytime, no contracts.
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Comment “NETWORK” or visit pmbnetwork.com to learn more.
This is general information, not legal or compliance advice. Referral compensation is not guaranteed and depends on the transaction, lender, and applicable brokerage/employer and state requirements — always confirm before accepting or arranging any compensation.