The strict mortgage approval requirements by banks in Canada deter many from applying for mortgages. The credit score requirement for a bank loan is 600 and this year, even more people will be stopped from accessing bank loans owing to the requirement that individuals qualify for higher interest rates starting October 2016. The only option for people who have been turned away by banks is private lenders who have a more lenient set of rules. Private mortgage lenders in Stratford exclusively service hard to place loans rejected by banks.
A private lender in Stratford is a business or individual invested in the real estate markets. Stratford’s real estate market is popular for stable, steady growth which is most attractive to private lenders. There is a huge presence of such lenders specialising in offering loans to Stratford and its environs. Lenders typically give upwards of $20,000 for one year unless the client has specific requirements. An extended period is possible for low-income earners who want to pay lower instalments each month. Private mortgage lenders like securing loans to property, which they can sell off to recoup if you are unable to pay agreed upon fees. The only catch is that in the event of a power of sale, the first mortgage holder must be compensated followed by the second and third until all lenders have made their claim. This is why private lenders charge high-interest rates and fees to try to recoup before the client is unable to pay fees.
Private lenders have different techniques of measuring credit worth from banks who solely depend on credit score. They key metric for a private lender is the loan to value ratio of a property and so they do not really mind the client’s credit score. Loan to value ratio is the equivalent of a home’s loans divided by its market value and many lenders will only loan up to 85% LTV on a property and 90% on rare occasions.
When getting a private mortgage you will be asked to state why you need the money. Unlike banks, this information is only for the records and will not be used to gauge your worth as a client. People have unique needs for money, which is why private lenders strive to provide tailored loan solutions. The private lender loan is one you can use to meet different needs and easily pay back according to the agreement. Some common reasons for needing the loan include:
Most people who seek private mortgages are those that were disqualified from accessing low-interest bank loans. Several of our clients have bad credit or low income as it is our speciality to offer loans in such circumstances. In addition, we help our clients repair credit to ensure their qualification for competent bank loans in future.
Banks, credit unions and all institutional lenders have a long mortgage approval process. This is impossible to speed up even when you have all necessary documents. Real estate deals are usually time sensitive and may collapse if money is not provided when it is required. We are able to provide fast financing for such deals so if your home purchase could collapse due to time factors, we will promptly connect you with one of our many private mortgage lenders in Stratford. We boast a great relationship with leading lawyers and real estate firms in Stratford, which enables us to provide urgent funding for property sales.
Like several cities in Ontario, Stratford has experienced massive increases in sales and real estate prices. This kind of a stable market attracts private lenders trying to gain from real estate. Housing in Stratford is affordable unlike in other Canadian cities like Vancouver. Stratford boasts a steady economy, which is also a reason why it is considered to be a great place to live in Canada. The whole of Ontario has recently witnessed marginal growth in real estate prices and sales, which contributes to the increased presence of private real estate lenders as people try to supplement their income.