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Just as in all second mortgage loan options, all lenders will be assessing the degree of equity in a homeowner's property. To calculate home renovation loans a lender will also ask to see a current appraisal to determine the current value of the property.
Of all the criteria that Ontario lenders assess, credit remains top of the list when it comes to approving refinancing options utilizing your home equity.
It can not be stressed enough that you need to bring a recent appraisal of your property to any meeting with a lender. All Ontario-based lenders including the big banks, trust companies/credit unions, and any private lending option will be assessing this appraisal very carefully.
When contemplating a second mortgage on your property there is reason to be optimistic. There are many advantages to exploring the option of accessing existing equity in your home for various short-term financial goals.
What exactly is a bridge loan? Simply put, bridge loans represent short-term loans (usually 3 to 12 month terms) in which a homeowner borrows against the existing equity in their home or property.
What if your credit is damaged? Owning a home does allow those who may have poor credit or reduced income to take out second mortgages for a number of financial objectives. Reasons to take a second mortgage can include the need to pay off existing debts, pay for any much-needed renovations, pay off legal fees or arrears if in mortgage default, and other pressing financial reasons.
Regardless of why an Ontario homeowner/borrower requires a secure mortgage loan, there remain choices pertaining to what loans are on offer. There are also choices to make in terms of what lenders to negotiate mortgage financing.
The Federal Government and the Bank of Canada have recognized the danger of taking on too much mortgage debt for several years now. A few years back, similar to what we are currently experiencing, the banks could afford to offer discounts on associated interest rates on different mortgage types. There became a need to assess what a homeowner could truly afford given a change of even 1% in their mortgage rate.
All lenders will be analyzing credit reports and have to obtain an understanding of why a borrower has the credit score that he/she has. Learn more
Although interest rates are propelling many Ontario homeowners/borrowers to take out mortgage financing, if you have poor credit the banks are not the answer. Stringent criteria prevent many with damaged credit from obtaining mortgage loans. Learn more