Home Renovation and Construction Loans Canada
Private lenders fill a void created by financial institutions that will not provide home renovation and construction loans to people who have a bad credit score, are self employed or live off a fixed pension. Private lenders provide private home renovation and construction loan for second and third mortgages and home improvement loans when other financial institutions will not. Private lenders are a viable alternative to many traditional financial institutions; their flexible loan criteria can fit many situations. Flexible criteria can become very important if the property is put up for “power of sale” since the first mortgage holder may incur fees which can greatly reduce the remaining equity in the property.
Private lenders are different from bank, because are money provided is funded by private individuals or private corporations. Private lenders are a significant source of funding for the real estate and mortgage industry; they provide financing that fills a void in the financial marketplace. Private lenders can provide first and second mortgages which can have either fixed or variable interest rates. A fixed-rate mortgage is a loan with monthly payments set at a fixed rate of interest and pre-determined monthly payment. Fixed interest rate mortgages are a popular option since you will know what your payments will be every month. Variable interest rate mortgages are dependent on interest rating, if the interest rates go up your monthly payments go up and vice versa.
All financial institutions in Canada including the major banks use credit information to determine how good or poor a credit risk you are so you can get a private loan. A poor or low credit rating can result in a mortgage application being rejected even if your present situation indicates that you are able to make the payments. In contrast private lenders concentrate on the loan to value (LTV) ratio in your home or property, private lenders will not reject your loan application just because you have a low credit score. Our mortgage brokers can match your financial needs with a private lender that provides money for poor credit private home loans in your geographic area.
Get a Private Loan
Most private lenders require a personal inspection of the property as a condition to get a private loan. The inspection process is fairly simple and straight forward; the private lender is looking for any obvious defects or damage, leaky roofs, broken doors or windows and any holes in the drywall that may bring down the value of the property. The owner should clean the house to make it look presentable; painting can be an easy way to hide any marks on the walls and a new coat of paint can make a house look clean. If private home loans are for repairs or renovations to the house or property show the private lender what work is to be done and how it will increase the value of the property.
Trying to find a private lender to provide home renovation and construction loans can be a difficult and stressful experience, but our mortgage brokers can provide you with the assistance you need. Our mortgage team can tell you in a short period of time if your loan will be approved and how long it will take for you to get the money from a private lender.