Private credit for family offices and high-net-worth investors

Private credit for family offices means lending capital against real assets for contracted income, outside the banking system. Co-funding with HomeSec is the direct version: you choose each secured loan, hold it for 1 to 12 months, are named on the registered mortgage, and lend alongside a lender that has its own money in every loan.

HomeSec Business Finance, an Australian private lender founded in 2004, funds most of its loans from its own balance sheet. On some loans it invites wholesale investors, family offices and high-net-worth individuals to co-fund, often on a 50/50 basis. Returns are 12% to 18% p.a. on the loans you choose.

Why are family offices and high-net-worth investors turning to private credit?

Because the income is strong and contracted, and it is secured against real assets rather than tied to share prices. Australian private credit has grown to around $200 billion, according to ASIC’s REP 814.

The difficulty is what sits inside that market. ASIC has flagged opaque fees, conflicts and infrequent valuations. In September 2026 it reported that, of 28 funds reviewed, only 4 disclosed the rates charged to borrowers and only 2 wholesale funds had stress-tested their liquidity, as reported by the ABC. In August 2026, several funds paused or limited redemptions, including Centuria Bass, CVS Lane, Merricks and Longreach, with MA Financial limiting withdrawals from one series to 1% a month (ABC).

Then there is the question of what the loans are secured by. More than half of Australian private credit is real-estate debt, mostly lending to developers, according to Livewire. HomeSec does no construction or development lending at all.

Sophisticated capital does not need to avoid private credit. It needs to own it directly.

What is direct lending, and how does co-funding differ from a fund?

Direct lending is lending straight to a borrower rather than through a bank, a bond or a pooled fund. Most private credit offered to investors is only direct at the manager’s level: you own units, and the manager does the lending.

Co-funding with HomeSec is direct at your level. You lend into a specific, identified loan, the loan agreement is in your name, you are named on the registered mortgage for your exact contribution, and principal and interest are paid straight into your own bank account.

Our comparison of direct mortgage investment vs pooled funds sets out each difference in detail.

How much control do you have over each deal?

All of it. Every loan is assessed against HomeSec’s 50-point due diligence checklist, and both joint CEOs are involved in every decision. Only then is it offered to you, as a due diligence pack by email.

You decide whether to fund it and how much. You can pass on a loan because of its location, its term, its LVR, its ranking or simply because it does not fit the rest of your portfolio. There is no obligation to take any loan, and no penalty for saying no. Over time, you build exactly the book of loans you want, rather than inheriting whatever a manager has already written.

If you run a family office, this also simplifies governance. Each investment decision is discrete, documented and traceable to a specific pack, which makes it straightforward to take to an investment committee.

Why do short terms suit capital that needs a home?

Because capital recycles. Loans run for 1 to 12 months. When a loan matures and is repaid, your principal and interest come straight back to your account, and you decide whether to fund the next loan or take the money elsewhere.

That makes co-funding a natural place to park capital between larger commitments:

• After a business sale, while you decide on the long-term allocation.
• Between property transactions, where you know roughly when you will need the funds.
• Alongside private equity commitments, where capital needs to be ready for future calls.
• Within a cash or fixed income bucket, where term deposits pay far less.

Each loan’s term is known before you commit, so you can match maturities to future needs. If plans change, HomeSec will buy out your share of a loan and repay your principal. Our guide to short term investments for large balances compares the alternatives.

What does it mean to co-invest alongside the lender?

It means HomeSec’s own money sits in the same loan as yours, on the same security and the same terms. HomeSec co-invests in every loan it offers to investors. That is rarer than it should be: in many pooled funds, the manager has none of its own capital in the loans.

HomeSec also earns mostly when loans are repaid, not when they are written. Its incentive is to write loans that come back, not to maximise volume. And because it has lent its own money since 2004, it has a long record of making those judgements with its own capital first. The rules behind every loan, including the maximum 80% LVR and the ban on construction and development lending, are set out in our lending rules.

How does co-funding approach capital preservation?

No income investment removes risk, and none should claim to. What matters is how many layers sit between a problem and your capital. On every co-funded loan, those layers are structural:

• An equity buffer. A maximum 80% LVR on residential property, lower on commercial, so values must fall a long way before the loan is exposed.
• Registered security. You are named on the mortgage over Australian real estate for your exact contribution.
• Short terms. 1 to 12 months, so there is less time for markets or circumstances to change.
• Saleable property only. No construction, development, land banking or unusual property.
• Enforcement at HomeSec’s cost. If a borrower defaults, HomeSec meets the legal costs of recovery on defaulted loans.

What reporting will you actually receive?

Reporting you can read in one sitting. Before you commit, you receive the full pack: the property, its value, the LVR, the borrower, the purpose, the term, the rate, the exit and the risks. Once funded, updates arrive by SMS and email, and repayments land directly in your own account.

Compare that with a typical fund report, which averages hundreds of loans into a handful of percentages. You cannot see which loans are late, which properties are being sold or what the manager is earning from borrowers. With co-funding, you can see exactly what each dollar is doing. If you are assessing any manager, our list of questions to ask a private credit manager is a useful checklist.

Where does co-funding fit alongside equities, private equity and property?

As a secured income allocation that behaves differently from the rest of the portfolio. For context, Vanguard’s 30-year index returns to 30 June 2026 were:

Those are long-run averages earned through booms and crashes. A co-funded loan works differently: it pays a contracted interest rate, set loan by loan at 12% to 18% p.a., for a known term, and each loan’s risks are set out in its pack. It is not a substitute for growth assets. It is a way to earn strong income from capital you do not want exposed to share-market swings, currency moves or a single company’s fortunes.

Can you invest through a company, trust or SMSF?

Yes. Co-funding is open to wholesale and sophisticated investors, and you can invest personally or through a company, family trust or SMSF. Each loan agreement is prepared in the investing entity’s name, and that entity is named on the mortgage. Family groups can co-fund through more than one entity, loan by loan. Our guide for wholesale investors explains how each entity qualifies.

You’ve made the money. Now enjoy it, with full control

You’ve already done the hard part. You built a business, sold it or grew a portfolio. Now you can enjoy life and still earn healthy returns, with full control over where every dollar goes. Read a pack from the golf course, a holiday house or an airport lounge, say yes or no, and let the repayments arrive in your account.

If you’d like to see what a loan pack looks like, register your interest and our Funding Manager will be in touch.