Private Mortgage Broker
If you have been turned down by one of the major Canadian banks because of poor credit or you are self employed then you will be happy to know that a private mortgage broker can help get the money you need. A private mortgage broker can provide an alternative source of funds for people who do not meet the stringent bank requirements. A private mortgage broker can provide funds for second mortgages, home renovation and debt consolidation loans. Most banks will not even consider funding these types of loads due to the higher risks associated with them. In contrast, a private mortgage broker provide funds specifically for these types of projects.
Many Canadian banks will not consider giving a loan or mortgage to people with self employed, banks require proof of income such as a “Notice of Assessment” from revenue Canada. If you do not have a recent “Notice of Assessment” because you have not filed your taxes or revenue Canada is with holding your notice because they are re-assessing you will find it very difficult to get a loan from most Canadian banks. A private mortgage broker does not require a “Notice of Assessment” since they base their lending decision on the equity in your home; this makes dealing with a private lender a much better option for self employed people.
The loan to value (LTV) ratio is one of the most common ratios to determine how much of a mortgage a borrower can obtain, a private mortgage broker will not usually go above a LTV of 85%. To determine your LTV ratio you divide the total of any current mortgages on the property by the market value of the property. An example of this would be a house in Oakville worth $400,000.00 that has a mortgage of $300,000.00 on it. The LTV is this example is 75% which is the level most major banks will go up to for a first mortgage. If this homeowner wanted a second mortgage for $30,000.00 the new LTV ratio would be 82.5%.
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A private mortgage broker will require an appraisal for real estate transactions to determine the present market value of a house or property. The appraisal process is fairly simple; a trained and certified appraiser will inspect your home and compare it to three similar homes that have recently sold in your area. Based on the comparative selling prices, features and condition of your home the appraiser will come up with a market value for your home. People who can find private lenders and appraisers like to see a clean and tidy house, so clean up before the appraiser comes to inspect. Cleaning and tiding will also give your property the maximum market value possible.
People who can find private lenders can provide loans or mortgages when other lenders may have turned you down. Our brokers can match your loan requirements with a private lender that provides funds to people in your situation. For a free consultation on how a private lender can help you can us today.