Private Mortgage Lenders in Sarnia
Canadian banks are strictly regulated by the government and this causes many to seek alternatives from private lenders. They are not subject to the same rules as banks so they can give loans to people with a credit score lower than 600 points. Banks must only lend to people with a habit of repaying their bills and debts to reduce the chances of bad loans. The process of recovery is long and bankers are not willing to pay for expensive lawsuits. Private lenders are invested in real estate and can risk loaning to people with bad credit but sufficient equity. Private mortgage lenders in Sarnia are responsible for servicing hard to place mortgages that were turned down by banks. If you are in need of funding and own property, a private mortgage lender might be able to help.
Mortgages from Private Lenders in Sarnia
Private mortgage lenders in Sarnia like to give out loans in form of registered mortgages secured against property. The Ontario Mortgage Act gives the power of sale to holders of registered mortgages meaning that failure to pay up might lead to loss of your house. A private lender will give you as little as $20,000 to be repaid in one year but you can request a longer term. A longer term is ideal when you have low monthly income as then, the instalments are lower and more affordable. Second mortgages and other high-risk investments attract high fees compared to bank loans. This is a measure taken to protect the interests of private lenders, who might not get a chance to recoup even after a power of sale.
Approval Criteria for Private Lender Mortgages
Private lenders only look at the price of a home and the debts on a property when they receive loan applications. This is different from banks that solely focus on credit score when making lending decisions. Private lenders measure credit worth by calculating the loan to value ratio of a property. This is obtained by dividing the total value of debts by the market price of a property and many private lenders in Sarnia can only loan up to 85% LTV on a house. The lenders may not be so keen about credit score but they will not lend to property above the 85% threshold to increase their chances of recouping from proceeds of a power of sale.
Reasons for Needing a Private Mortgage
The lender will ask why you need a loan but that should not worry you. Private entities are very lenient, accepting nearly every response. Some common reasons why people choose private mortgages include:
For living expenses after being laid off from a job
- To pay tuition fees for college or university
- To pay off high-interest loans
- To stop a power of sale or foreclosure
- To pay for home renovations or repairs
Individuals who did not qualify for traditional loans from banks are the main targets of private lenders. Our network of private lenders in Sarnia is ready to provide loans to help property owners in the city reach their financial objectives.
Fast Financing by Private Lenders
The major banks in Canada are tied down by strict rules which make mortgage approval long and tedious. It is impossible to speed things up with the banks but thankfully, you can get a loan in as little as a day from a private lender. They are so flexible, that they can provide tailored solutions to people in need of loans. The lenders in our network can also provide solutions to people in other cities across Ontario.
Information on Lenders in Sarnia Real Estate Industry
Sarnia is in Ontario, a widely discussed province of Canada for its booming real estate industry. Many people in Sarnia are turning into private real estate lenders as a means of substituting their income. Ontario is also home to Toronto city, which recorded the highest prices in real estate over a period of two years. Sarnia is an important location to private lenders looking to serve the many people who wouldn’t qualify for traditional low-interest loans offered by banks. The province is an important economic hub for the country and also one of the best places to live.