Key Terms You’ll Hear in Private Lending

Terms You May Come Across in Private Lending When Instructing a Solicitor

When you enter into a private lending transaction, you may encounter legal and financial terms that feel unfamiliar. These terms are not just technicalities — they form the foundation of how your loan is structured, secured, and enforced. At Whitestone Law, we believe that clarity is key. Below we explain some of the most common terms you will hear when instructing your solicitor in an Australian private lending matter.

Title Search

A title search is an official record issued by the State or Territory Land Registry (for example, NSW Land Registry Services). It shows who owns the property and what interests are registered on the title, such as mortgages, caveats, easements, or restrictions. Your solicitor always orders a title search to confirm ownership and ensure there are no unexpected encumbrances before settlement.

PEXA (Property Exchange Australia)

PEXA is Australia’s digital property settlement platform. Nearly all property and mortgage settlements are now completed electronically through PEXA. This system allows lawyers and lenders to transfer funds and lodge documents (such as mortgages or discharges) with the Land Registry in real time, making settlements faster and more secure.

VOI (Verification of Identity)

Under the ARNECC Participation Rules, your solicitor must verify your identity before completing a property or lending transaction. This process, known as VOI, usually requires a passport or driver’s licence and can be done face-to-face or through an approved online provider. VOI helps protect against fraud and ensures compliance with national standards.

Mortgage

A mortgage is a registered interest over property given as security for the loan. In Australia, mortgages are prepared in the National Mortgage Form and lodged with the Land Registry. If the borrower defaults, the lender may enforce its rights against the property.

Caveat

A caveat is a statutory notice lodged on the property title to protect an interest in the land. For example, a private lender may lodge a caveat while waiting for its mortgage to be registered. Once in place, the caveat prevents any further dealings with the property unless the caveator consents.

Loan Agreement

The loan agreement is the contract between borrower and lender. It records the loan amount, repayment terms, interest rate, default provisions, and enforcement rights. In Australian private lending, loan agreements often include prepaid interest, higher default interest rates, and clauses confirming whether the National Credit Code applies or is excluded.

PPSR (Personal Property Securities Register)

The PPSR is the national register of security interests in personal property other than land — such as shares, vehicles, or business equipment. Private lenders often use PPSR registrations alongside mortgages to ensure layered protection of their loan. Registering on the PPSR secures a lender’s priority over competing claims.

Company Search / ASIC Search

Where the borrower or guarantor is a company, your solicitor will conduct an ASIC search to confirm its directors, shareholders, and whether it has existing charges or insolvency appointments. This step ensures the lender knows exactly who controls the company and whether there are risks.

Settlement

Settlement is the moment when the loan funds are advanced and security documents are registered. In Australia, this now takes place almost exclusively through PEXA. On settlement, your solicitor ensures the lender’s mortgage or caveat is lodged and funds are transferred securely.

Why These Terms Matter

Understanding these terms helps borrowers and lenders engage with confidence. They are not just legal jargon — they are the building blocks of a secure transaction. Being familiar with them means fewer surprises and a smoother process when instructing your solicitor.

How Whitestone Law Can Help

At Whitestone Law, we translate complex legal documents into clear, practical advice. Our role is to protect your interests and ensure your private lending transaction is completed with precision and efficiency. Whether you are a lender or a borrower, we provide the clarity and strategy you need to move forward.

If you are considering a private lending transaction, contact Whitestone Law today. We will guide you through every step and safeguard your position with confidence.