People who have had some financial difficulties will want to look into bad credit mortgages in Richmond Hill. Read the following and you’ll see why this is an attractive location and how these mortgage products help.
According to areavibes, Richmond Hill has an exceptional livability score of 82. That’s compared with a 72 for Ontario and 67 for the entire country. Some of the best areas to live in for families in Richmond Hill include Jefferson. The population there is 20,477 as of October 2022. The median age of people living there is 38 and the percentage of families with children at home is 69%
This town has a few close neighbours that are also hubs in the GTA like Mississauga, Brampton Etobicoke, and Oshawa. Richmond Hill has some other features that make it an attractive area to live in. For example, crime in Richmond Hill is estimated at a lower number than both the Ontario and national averages per 100,000 people.
Mortgage Applications and Credit Scores
Large Canadian banks will only approve mortgage applications when the applicants have good credit scores. Without a credit score of at least 600, you’ll have a difficult time getting a bank mortgage. Equifax considers a poor score below 560. Our staff focus on clients who need bad credit mortgages in Richmond Hill.
Here’s some more information on what different lenders require.
Credit Scores That Different Lenders Require
- Canadian Banks require a credit score of 600 or greater.
- Trust companies require a credit score of 550 or greater.
- Private lenders do not have any credit score requirements.
Canadian banks and trust companies don’t negotiate mortgages unless applicants meet these credit score requirements. Private lenders take a more lenient approach. They work with people who have been turned down by banks. Our mortgage brokers provide access to private lenders offering bad credit mortgages in Richmond Hill.
Getting a Copy of Your Credit Score Report
Understanding your financial position starts with getting a copy of your credit score report.
Mortgage providers can access these numbers from the Canadian credit bureaus–Equifax and TransUnion. Our brokerage provides a free copy upon request. Alternatively, you can go to the Equifax and TransUnion websites to get the same information for a small fee.
Credit scores get damaged for a variety of reasons. Not paying bills, adding on too much overall debt, and consumer proposals or bankruptcy are all factors.
Private Lenders for Bad Credit Mortgages in Richmond Hill
If you have a damaged credit score, private lenders for bad credit mortgages in Richmond Hill are a good alternative.
A private lender can also offer mortgages to people who have gone through bankruptcy or a consumer proposal. We have contacts with lenders servicing all of Ontario which includes Richmond Hill.
Please read on to find out how these bad credit mortgages have different criteria.
Requirements for Getting a Bad Credit Mortgage
The requirements for getting a bad credit mortgage in Richmond Hill focus on a few different factors. For example, a lender examines the value of and the existing mortgages on the property. A loan isn’t possible if there’s too much-secured debt.
Under the Ontario Mortgages Act, a lender can proceed with legal actions to sell a mortgaged property 15 days after the first missed payment. It usually takes 3 to 4 months to sell the property. . When the asset is sold by the lender, the mortgages must be paid out in the order in which they are placed. This means a lender can lose money on a second or third mortgage if the value of the first mortgage is close to the value of the property.
It’s obvious private lenders for bad credit mortgages in Richmond Hill need a formula to determine the risks involved.
The LTV Ratio
Lenders determine this by calculating the Loan to Value ratio (LTV) of the property. Lenders investing in Richmond Hill are able to lend on properties up to 75% LTV. Private lenders are flexible on mortgage rates and terms, and may provide discounts with a high income.
About The Costs Associated With Bad Credit Mortgages
People with bad credit must seek a private lender if they want a mortgage on their property. There are different costs associated with these bad credit mortgages.
To begin, they have relatively high-interest rates. Banks offer rates of around 3% to 4% while private lenders charge 7% to 15%. A private mortgage also has some additional fees to set the mortgage up. For example, a private lender needs to pay their staff, lawyers, and a home appraisal company. Our brokerage provides clients with a number of offers and we supply recommendations on which one we feel is best.
Applicants can do their part by working to improve a damaged credit score.
Improving Your Credit Score
Improving your credit score starts with paying all of your bills and credit card fees every month. Some people put small amounts on their credit cards so they can be paid off easily.
A more expensive but foolproof method of improving a credit score involves applying for a secured credit card at a bank. This type of product requires an initial deposit which is used if the card’s fees are left unpaid. Stay below 60% of the limit. After 6 months of consistently making payments on bills and credit cards, your credit should be repaired.
Applying for bad credit mortgages in Richmond Hill is well worth the effort. Consider some real estate statistics on the area as proof.
Real Estate in Richmond Hill
Current MLS statistics for real estate in Richmond Hill have 304 new listings in the last 28 days for October 2022. The outlook is positive since the average sold price in the area is 1.5 million dollars and that represents a 4.4% bump YoY. If you’re looking to buy a house in Richmond Hill, it’s not a good idea to hesitate.
Numbers for October 2022 show the median days for a house on the market is only nineteen.