Private Mortgage Brokers
Has your mortgage application been declined by a traditional bank or lending institution (or perhaps by more than one such lender)? Is your current credit rating impeding your effort to secure a conventional mortgage? Have you been told by a traditional lender that your type of work is too high-risk for you to qualify for a mortgage?
In such instances, a private mortgage may be a better option for a potential home owner. The funds for a private mortgage are provided by an individual lender, or a group of individual lenders, who are willing to invest in people and property as a means of generating a greater return on investment than they can earn through other methods (GICs, T-bills, bonds, etc.).
Natasha Bridgmohan and her team of private mortgage brokers can help secure private funding when you cannot obtain a mortgage through traditional lenders. Finding the right private investor requires considerable time and effort and our experienced mortgage brokers are willing and able to tackle that challenge. We have established strong relationships with several private lenders and are fully committed to connecting you with the private investor who best meets your specific needs.
When to Consider a Private Mortgage
There are several situations or circumstances when a private mortgage should
- When a traditional lender (bank or financial institution) declines your application
- If you are self-employed
- If you have a less-than-acceptable credit rating
- When you need immediate financing
- When you require a less rigid payment schedule
- After a recent bankruptcy
- After a dramatic, life-changing event – divorce, reduction in income
- When you cannot meet the required or minimum down payment
- When your income is from non-traditional sources – seasonal work, tips, commissions
- When you are looking to consolidate your debt
- To obtain a second mortgage
What Can You Expect With a Private Mortgage?
Private mortgages differ from traditional mortgages in a number of ways.
Major differences include:
- Interest rates customarily higher than posted bank rates
- Shorter terms – usually one to three years
- More lenient or flexible payment schedules
- Approvals in as little as one day to two weeks
- Funds available within one to three weeks
- Potential of an additional lender fee – ranging from 1.5% to 3.5% of the total purchase price
A Word about Risk and Rates
The most influential factor in determining the interest rate for a private mortgage is the amount of risk that is perceived or associated with the loan. Individuals who apply for a private mortgage are generally in a higher risk situation, and as a result, the interest rates are usually higher than those of traditional mortgages.
Conversely, the approval criteria for obtaining a private mortgage are often much more flexible than the rigid requirements of a traditional lender, and the payment terms and conditions for a private mortgage can vary from case to case.
Tip: Private mortgage brokers want to be assured that you, and your home or property, are indeed a good investment. Strengthen your chances for a successful application by collecting as much supporting documentation as possible – bank statements, tax returns, notices of assessment, proof of employment and income, property appraisals, etc.
Many borrowers may be hesitant to pursue a private mortgage, perhaps due to misconceptions relating to interest rates and payment terms. Natasha Bridgmohan and her team of Toronto mortgage brokers are here to answer your questions and, on your behalf, take the lead in securing a private mortgage.
To obtain more information, consult the professionals at Mortgage Intelligence. Call us toll-free at 1-866-553-7467 ext 221.