Due to the strict mortgage approval requirements that Canadian banks have, many mortgage applicants are being turned down. Private lenders in Ottawa are one of the best options for people turned down by banks. The mortgage requirements for these private lenders are far less strict than those of the banks’. According to a recent change in mortgage law, starting October 17th, 2016 people will have to qualify for higher interest rates. This particular change makes it so that many people no longer qualify for a mortgage. Ottawa’s private mortgage lenders have far less government oversight and can provide mortgages when banks cannot.

Private Mortgages

A private lender in Ottawa can be a company or an individual who is looking to invest in Ottawa real estate. Ottawa’s real estate market is known for its steady and stable growth, and is attractive to private lenders. There are many private lenders that specialize in properties located in Ottawa and the surrounding area. Lenders will typically loan out $20,000 or more, and typically for 1 year terms. Most private lenders will secure the loan to the property, which can be sold if the borrower does not make their payments.

Private lenders have different requirements than banks, and can ignore poor credit scores. The primary concern for Ottawa private lenders are the home’s market value, and the value of existing debt secured against the home. The key metric that lenders use is called a Loan to Value Ratio (LTV). A property’s LTV is equal to the value of existing debts against the home divided by the market value of the home. As an example, a home in Ottawa could be sold for $100,000, and it had a $65,000 first mortgage, this means the LTV would be 65%. Many lenders in Ottawa will lend on real estate that have less than 75% LTV, and in rare cases up to 90% LTV.

Reasons for Getting a Private Lender Mortgage

When getting a private mortgage from a lender in Ottawa, the lender will ask for the reason you need the financing. Common reasons to need financing are:

  • To pay off high interest debts
  • To upgrade or renovate an existing building
  • Termination at place of work, or other loss of income
  • Traumatic life event, such as death of a relative or car accident
  • To invest in higher education

Most people applying to private mortgage lenders have already been disqualified from getting a bank mortgage. Many of our clients have bad credit or insufficient income and we specialize in getting mortgages in these circumstances.  We also help clients repair their credit and become eligible for bank loans in the future.

Quick Mortgage Financing

Traditional lenders such as banks and credit unions have a long approval process. Often times it is not possible to speed up the process even will all the correct documents are provided. In many real estate deals, if the money is not provided quickly the deal may collapse. We are able to provide financing for time sensitive real estate deals. If your home purchase is at risk of collapsing due to time constraints, we’d be happy to connect you with one of our Ottawa lenders.

We have a large database of lenders many of which lend in Ottawa and the surrounding area. We have experience with all the major real estate firms and lawyers in Ottawa, and are able to provide funding on strict deadlines.

Information on Ottawa Private Mortgage Lenders

Like many cities in Ontario, Ottawa is experience double digit sales and price growth for residential properties. This attracts investors looking for a stable place to invest in. Unlike other Canadian cities, such as Vancouver, Ottawa housing is described as affordable as price increase have been growing alongside income. Ottawa’s real estate market is known as one of the more stable ones in Canada. Ottawa has a healthy growing economy, and has one of the highest quality of life ratings of any city in the Americas.

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