Due to the strict nature of bank lending requirements, getting a bank mortgage can be very difficult. For people who have been turned down by banks, using a private mortgage lender in Vaughan is a good alternative. Vaughan private lenders are also not affected by legislation that targets other lending institutions. This is a key advantage especially since on Oct 17, 2016 the federal government implemented new rules requiring bank borrowers to qualify at higher interest rates. Private lenders have more relaxed rules for lending and can lend money when banks can’t.

The private lenders that service Vaughan are usually private individuals or companies which seek a return on their money via real estate investing. Vaughan is an up and coming area which has a growing population and a growing number of businesses. Private lenders that deal with Vaughan will provide loans of at least $20,000 and for one year terms. These lenders will provide the money in the form of a property secured mortgage. The loan being secured to the property reduces risk for the investor, as the property can be sold to recoup any losses.

Private Lender Mortgage Requirements

Private lenders do not prioritise credit score, to them the most important figures are the home price and the existing debts on the property. Private lenders use what is called a Loan to Value Ratio (LTV) when deciding whether or not to lend on a property. The LTV of a property is equal to its debts divided by the estimated selling price. For example, if a property can be sold for $1,000,000 and has existing mortgages totalling $650,000 then the LTV of the property is 65%. For properties in Vaughan the maximum LTV a lender will go up to is usually 75% or  in special cases up to 90%.

Common Reasons for Needing a Private Mortgage

Before a private lender provides financing, they will request the reason why the financing is needed. There are many valid reasons for needing private lender financing. Some reasons that we commonly hear about are:

  • Paying off high interest debts
  • Fixing damage done to a property, or to improve the property
  • Unexpected termination at place of work
  • Being evicted or Power of Sale/Foreclosure on your property
  • Going back to school for additional education

People who turn to private lenders typically have been turned away from the major banks. Private lenders in Vaughan regularly work with this kind of people when providing financing. We also develop a long term plan to ensure that your credit score improves over time, making your eligible for cheaper financing.

Fast Private Mortgage Loans

All of Canada’s major banks have a lengthy and in-depth mortgage approval process that can take months. These institutions have no way to speed up their process, which may be troublesome if the real estate deal is time sensitive. Some deals can be at risk of falling apart if financing doesn’t come quickly, and for this purpose, a private lender would be more suitable. Our lenders can work with extremely strict deadlines and still provide financing in time. We have access to a network of private lenders who serve the entire GTA which includes Vaughan.

Info for Vaughan Lenders

Vaughan is located north of Toronto and is known for its high population growth. Many Vaughan investors look to invest in detached homes which are sought after by new families. Vaughan is the 17th biggest city in Canada and has a booming industrial sector. Many people choose to live in Vaughan due to the availability of jobs and its proximity to Toronto.

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