Banks operating in Canada are under strict rules by the government and this causes people to seek loans from private lenders. Many of the private lenders serving in Ontario do not follow the same rules as banks do and so if you were turned away by banks, private lenders might offer some respite. Private mortgage lenders in Cambridge follow a different loan approval criteria than banks, which gives borrowers a chance to get loans no matter the state of their credit.
The private lenders operating in Cambridge prefer to offer loans as registered mortgages. The Ontario Mortgage Act allows private lenders to sell the property if the borrower fails to pay in accordance with the terms. The loan offered might be as little as $20,000 and you are expected to repay in one year unless you make a request for an extended term. An extended repayment term means you pay low instalments each month which is less of a hassle than keeping up with high interests on credit cards.
Lack of income and second mortgages are an example of riskier loans, which attract higher fees than regular bank loans. Private lenders in Cambridge charge more for high-risk loans in order to increase their chances of recouping. Individuals or companies offering private loans make their profits from real estate and the Cambridge market is very attractive as it is highly profitable. Ontario generally has some of the highest real estate appreciation rates in all of Canada.
Private lenders solely focus on the market value of the property and the total of debts against it. While equity is the most important factor for private lenders, banks focus on credit score to decide who to loan. Using the home’s appraised value and the total debts, a private lender can calculate a metric known as loan to value ratio. If after dividing the homes debts by its price they get a value below 85%, private lenders will extend the mortgage. Private lenders avoid properties with so many debts as it decreases their chances of compensation if a borrower is unable to honour the loan.
During the application for a private lender mortgage, you will be required to explain your reasons for needing the money. There is no need to worry, as private lenders are more lenient than banks, accepting any reasonable explanation. The most common reasons for needing the money include:
Those who cannot get low-interest loans offered by banks are the kind of clients sought by private lenders. Our private lender network can offer mortgages to people in Cambridge who have been rejected by banks.
Major Banks in Cambridge follow a long, thorough mortgage approval process. Banks check your credit score, analyse your financial history and evaluate your reasons for needing the loan. You have to fill out lengthy forms and patiently wait for a response which could be negative. There is no way to speed up matters and this can be a problem for property sales in urgent need for funds. Private lenders are able to offer funds much quicker than banks and if need be, they can even provide the money in as little as one day. Private lenders are only concerned with property equity and it takes a very short time to ascertain that yours is indeed a worthwhile investment. Lenders in our network offer loans to real estate anywhere in Ontario, Canada.
Cambridge is one of the cities in Ontario, a province of Canada that is the subject of much debate. Ontario is on the south side of Canada on its border with the US. The last two years have seen double-digit spikes in real estate prices, which is why so many people are turning to private real estate lending in Cambridge to substitute their income. Ontario is both an economic powerhouse and one of the best places to live in Canada.