Private Mortgage Lenders in Cornwall
Banks in Canada are under strict government control, which leads to many people having to turn to private lenders when they need mortgages. To get a bank loan, you must present a credit score of 600 points or more. Banks believe this is the only way to avoid bad debts and the long legal process likely to ensue when trying to recoup their investment. Private lenders are not as regulated as the banks meaning they can provide loans to individuals who could not get bank loans. In fact, many private mortgage lenders in Cornwall specialise in servicing the hard to place mortgages by banks. They are interested in an individual’s property and not the credit score that banks solely rely on to make a conscious lending decision.
Mortgages from Private Lenders in Cornwall
Private mortgage lenders in Cornwall only issue loans in form or registered mortgages on a property. This is to give them the power of sale for cases when the borrower is unable to repay agreed upon mortgage fees. The loan amount offered may be as low as $20,000 that the lender hopes you will repay in one year unless you had previously requested a longer duration. The riskier a mortgage is, the higher the fees you will pay to the private lender. Interest rates and fees for private lender mortgages are generally higher than those charged by banks. The mortgage fees are needed upfront to pay real estate lawyers, appraisal and other staff involved in setting up the loan. Private lenders are in the real estate industry and that is the reason for their interest in the vibrant Ontario province including Cornwall.
Approval Criteria for Private Lender Mortgages
Private lenders are only interested in the value of a property and all its debts when approving mortgage applications. Banks solely depend on credit score to decide whom to give a loan. The private lender uses the price and debts on a property to get its LTV or loan to value ratio. The ideal result should be 75% after dividing total debts by the value of a house because that is the maximum threshold for private mortgage lenders in Cornwall, Ontario. The higher the LTV, the lower the equity in a property, and therefore; the lower the chances of getting a private lender mortgage. Private lenders are not concerned about credit score but they will certainly avoid loaning to the property with too many debts.
Reasons for Needing a Private Mortgage
While applying for a private lender mortgage you will be required to state your reasons for needing the money. Private lenders are quite lenient and accept most reasonable answers. Some common ones include:
- To pay off high-interest credit card debt
- To pay for home repairs or renovations
- To stop a power of sale or foreclosure
- To pay tuition fees for college or university
- For living expenses after being laid off
Those who cannot qualify for low-interest rates from banks are the kind of clients sought by private lenders. Our network of private lender can offer mortgages to those that have been turned down by the banks.
Fast Financing from Private Lenders
The major banks in Ontario should follow a rigorous process laid down by the government when considering mortgage applications. This takes too much time and can be a problem for property sales in an urgent need for money. Private lenders are capable of providing money much faster than banks. If required, they can arrange the loan in only a day, which is very helpful in resolving a power of sale or paying emergency medical bills. Our private lenders can lend on real estate in other parts of Ontario including Cornwall.
Information on Lenders in the Cornwall Real Estate Market
Cornwall is part of Ontario, a vibrant real estate market recognised all over the world. Toronto, one of the cities in Ontario recorded some of the highest real estate prices ever, bringing the entire scene alive. More people are turning to private lending as a way of supplementing their income. Experts agree that the appreciation in real estate prices will continue. Ontario is both a desirable place to stay and the economic hub of Canada.