Banks in Canada must follow strict rules set by the government and this makes many potential clients turn to private lenders. These are companies or individuals who can loan to people who have been turned away by banks. They are not under similar government regulations and can, therefore, go against the norm to accommodate people with bad credit among their mortgage clients.
Private mortgage lenders in Brantford will only give out money in form of a registered mortgage on a property. This according to the Ontario Mortgage Act gives a private lender the right to sell any property in default to try and recover some investment. You can get anything upwards of $20,000 to be paid in one year. The client may choose to end the loan early or request for an extended duration according to their circumstances. Some types of loans like second mortgages and loans to people without income pose huge risks which trigger higher fees compared with bank loans. The money is often requested upfront to pay real estate lawyers, lender’s staff, appraisal and other professionals needed to arrange the most suitable mortgage. Private lenders love investing in real estate and it is, therefore, understandable that they are so attracted to Brantford, Ontario, with its promising future. Prospects continue to indicate growth by major leaps as real estate continues to appreciate by wide margins.
Private mortgage lenders in Brantford concentrate on a property’s value and debts when making lending decisions. This is a disparity from banks who mainly rely on credit score when choosing creditworthy clients. Private lenders need to determine the loan to value ratio of a property before giving any loans. LTV is obtained by dividing the total value of mortgages on a home by the selling price most recently appraised. This means that if you have a home worth $1,000,000 and have $750,000 in debt, the LTV is 75%. In this case, a private lender would give an offer as it is below the maximum threshold of 85% LTV. They may not be so keen about credit score but private lenders are wary of the risk posed by the bulk of their clients. This is why private lenders often avoid loaning to properties with too many debts.
Private lenders need to know why you need the money during mortgage application. Private lenders are more lenient than banks and tend to accept nearly every reason given for needing the loan. There are many uses for a private mortgage but some are more common:
Anyone who falls below the standard set by banks can turn to private lenders who are not tied down by strict rules. We have a wide network of lenders who are always willing to offer reasonable loans to people who were denied loans by banks.
Banks follow a long, strict process when considering loan requests and there is no way to speed things up. Private lenders are not governed by the same rules as banks and they can, therefore, provide funds much faster. It can take only 24 hours to process your private loan and this comes in handy when you have to resolve a power of sale or another emergency to resolve. Private lenders are more flexible than banks and can, therefore, provide customised loans to meet a customer’s needs. Besides Brantford, our network of private mortgage lenders also service other cities and towns in Ontario.
Being located in Ontario, Brampton is filled with private lenders looking to leverage the growing real estate industry. The past few years have seen a rise in real estate prices which has led many to invest in the sector as a source of extra cash. Ontario is considered to be one of the best places to live in Canada and an economic powerhouse with great future prospects.