In a private financing scheme, what do investors typically promise to potential borrowers?

In a private financing scheme, investors typically promise high returns on investment to potential borrowers. This is because private investors, unlike traditional banks or financial institutions, often take on greater risks when lending to borrowers, particularly those who may not qualify for standard financing options. To compensate for this risk, investors seek higher returns on their investment as part of the agreement.

The emphasis on high returns reflects the nature of private financing, where investors are motivated by the potential for significant profit rather than by the standard practices of financial institutions. Borrowers, in turn, are seeking access to capital that may not be available to them through traditional channels, creating a dynamic where both parties are engaged in a risk-reward relationship.

Other options don't accurately encapsulate the typical promises made in such financing schemes. Low-interest rates, guaranteed approvals, and free credit services are not standard offerings or commitments in the realm of private financing. Instead, the focus remains on the potential for high returns, which aligns with the investors' motivations and interests.