A non-bank lender is a company that makes loans but does not take deposits, so it is not a bank, a savings institution or a credit union.
A bank funds loans with deposits. A non-bank lender has none, so it funds loans with its owners’ money, investor capital, credit lines from banks, or by selling the loans it makes. The group is wide: mortgage companies, debt funds, life insurers’ lending arms, private lenders and specialty finance firms.
The mortgage disclosure rule shows how regulators draw the line. It splits reporting lenders into depository institutions, meaning a bank, savings association or credit union, and nondepository institutions, meaning a for-profit mortgage-lending institution other than those three.
For a borrower the differences are practical. A non-bank has no deposit relationship to offer or to ask for. It is not bound by a bank’s lending limit or by bank supervisory guidance on real estate concentrations, so it can sometimes take a deal a bank passed on. The cost of its money is usually higher than deposits, and the rate reflects that.
Public data on non-banks is thin. Where a file names one, it shows loans made, not financial condition.
How it shows up in the data here
Non-bank lenders appear on this site only where a public file names them: mortgage disclosure data for apartment and 1-4 unit investor loans made, and SBA data for 7(a) loans. Search non-bank lenders. They file no call report, so there are no balances held, no capital and no size estimate for them, and a non-bank that lends only on offices, retail or business assets is not in any file used here.
Go further
- Search non-bank lenders: Non-banks named in mortgage disclosure or SBA data.
- 1-4 unit investor lenders: Who made rental and business-purpose 1-4 unit loans.
- What to do after a bank says no to a business loan: One bank's no is one lender's answer, and the reasons are yours to ask for. They usually point to a constraint you can name.
- How to read HMDA data for multifamily and investor loans: HMDA is the one public file that lists individual apartment and rental-house loans by lender, amount, county and year. It covers loans on dwellings only, and not every lender reports.
Related terms
- Debt fund: A private investment fund that makes or buys loans with money raised from investors, instead of taking deposits the way a bank or credit union does.
- Hard money loan: A short-term real estate loan from a private or non-bank lender that is decided mainly on the property's value and the exit plan, not on the borrower's income.
- DSCR loan: A business-purpose mortgage on a rental home of one to four units that is sized mainly on the property's rent against its payment, not on the borrower's personal income.
- Agency lender: A lender authorized to make apartment loans that Fannie Mae or Freddie Mac then buys or backs, under those companies' rules instead of the lender's own.
- Life company lender: A life insurance company that makes long-term, fixed-rate commercial mortgage loans with its own investment money and usually keeps them.
- Home Mortgage Disclosure Act (HMDA): The federal law that makes mortgage lenders collect and publish loan-level data on loans secured by a dwelling, including apartment buildings and 1-4 unit rentals.
- Portfolio lender: A portfolio lender is a lender that keeps the loans it makes on its own books instead of selling them to an investor.
Sources
Plain definitions for orientation, not legal, tax or credit advice. A lender's own policy decides what it will do.