St Catharines is a place with a lot of noteworthy features. For example, the cost of living there is 9% lower than the national average. The median age of the people who live there is 44.4 years and 66% of the citizens in St Catharines are married.
A Number of Excellent Neighbourhoods
The city has a number of excellent neighborhoods to choose from. Barbican Heights enjoys a park that’s suitable for family activities in all seasons. It has a playground and a basketball court that compliments the inviting atmosphere. Riverview and Lakeshore are other family friendly locations in St Catharines.
The city has a high score for livability of 85 on the website areavibes. That means it has exceptional amenities, a good cost of living and a high safety rate when it comes to crime.
Education As An Important Factor
Education is always an important metric for people looking to sell or buy. Once again, St Catharines scores high with an A rating for the schools in the area. The average test scores there for students are 14% higher than the national average.
People looking for a traditional mortgage to buy in that city need to go through a lengthy set of steps that includes a pre-approval application. This process can be long and quite involved. You’ll need to sign a credit authorization allowing a mortgage broker to preform a credit check for starters.
There is an alternative.
Private mortgage lenders in St Catharines are not regulated by the same strict requirements as traditional banks and other institutions like credit unions. Therefore the process for these alternative lenders is more streamlined. Please read on to find out more about how this alternative form of financing works.
The Requirements For Private Lender Mortgage Approval
Traditional institutions like banks place a heavy emphasis on an applicant’s credit score. A private lender places more focus on other metrics like the appraised value of the property and the existing equity.
The loan to value ratio (LTV) is a central formula that gets used. Private lenders will usually lend money up to a maximum of 75% LTV. This is the ratio that compares the amount of money borrowed to the market price of the condo or other property.
The LTV Calculation
The calculation works this way. Say you have a house, cottage or other type of property that’s worth a million dollars through a market appraisal. If you owe $750,000 on that same property you qualify for a private loan.
There are a variety of reasons why people need to turn to these alternative lenders. Damaged credit is just one. Life can present a series of unexpected financial surprises that can steer you toward this option.
Why People Need Private Lenders
One of the big reasons that people need to turn to private lenders is they are facing either a foreclosure or power of sale. The mechanics are slightly different between these two financial tools, but the result is the same. The homeowner gets evicted at the end of either one.
With a foreclosure, the lender can take the title to the property. The homeowner sees none of the proceeds from a sale. With a power of sale the homeowner gets the excess profits from any sale. The services of private lenders can be used for a variety of other reasons including:
- Paying for expensive home renovations. One of the broad categories is repairing or renovating a house. This has an average cost of $48,000 and can cost even more with unforeseen expenses.
- Private mortgage lenders in St Catharines can also supply some money to cover your living expenses if you’ve been laid off.
- The money can also be used to pay off other debts like high interest credit cards. In fact, according to a report from Yahoo quoting Equifax ( March 09 2023), credit card debt in Canada has topped $100 billion dollars (CDN) for the first time.
For these reasons than others, some people are turned away by banks and private lenders in St Catharines are their best option.
Rapid Financing from Private Lenders
The banks’ approval process for mortgages can take anywhere from 11 to 25 days or even more. Plus, there are quite a few different documents that need to be provided, including those for employment information like a current T4 slip or a series of pay stubs. Traditional learning institutions will also want to see rental income, investments and or freelance income.
Not Restricted By The Same Rules
Private lenders are not restricted by the same federal and provincial rules as their traditional counterparts. These alternative lenders can also overlook credit issues and have an approval for you in just a few days in many cases.
The Importance of Marketing Trends
Making the proper decision about private mortgage lenders in St Catharines means understanding the market trends for cottages, condos and other properties. These are essential to understanding the value.
Trends in St. Catharines Real Estate Market
While new listings remain at solid levels in the real estate market in St Catharines, other metrics highlight some changing numbers. Here are some examples.
The Niagara Association of REALTORS® (NAR) MLS® reports that for February of 2023 the number of homes that sold in St Catharines was 483. That represented a large decline of 31% YoY.
Sagging Home Sale Results.
Home sales were also showing sagging results. The five-year average highlighted a 20.5% dip and the and the 10-year average for the month of February 2023 showed a 15.4% decline. The benchmark price for a single family dwelling was also down sharply at $640,700. That represented a 22.9% drop YoY.
Mortgage Broker Store is a private mortgage lender serving St Catharines and a number of other areas. Call 416-499-2122 or email ron@mortgagebrokerstore.com for some free advice.