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Understanding Private Lending

Understanding Private Lending

 

Private lending has for many years been viewed in a negative light, and unfortunately, often for good reason. Too often we hear of friends or family being saddled with unexpected fees and exorbitant rates, and no way out.

Recent changes to government regulations have restricted the lending policies of many lenders. Because of this private lenders are becoming a larger part of the lender market, and is well understood by this Hamilton Mortgage Broker.

Unlike traditional lenders such as Banks and Trust companies, private lenders aren’t constrained by the same set of rules. If a private lender thinks a deal makes sense as an investment they can do it. No stress test to worry about, no income issues if you’re self-employed, new to the job, etc.

Private lending has become more mainstream, and competition among the various lenders has grown, providing more attractive options for borrowers that don’t qualify for mortgages with an institutional lender.

Unlike traditional lenders who pay us for receiving your mortgage, private lenders typically do not, so we do have to charge our client for this service. In saying that Canadian Mortgage Authority is very reasonable in the fees that we would charge, and based on the amount of work that we have to do, not on what we feel we can get away with, which historically some Hamilton Mortgage Brokers, among others have done.

As seasoned mortgage brokers, we have many options for private lenders, from small individual investors to large national Mortgage Investment Corporations. As always we work for you rather than the lender and always get you the best deal possible.

When considering a private mortgage we always look at your overall situation and needs and decide together whether it makes sense. Sometimes a private mortgage can be the best option when you require short-term financing, vacant land, or unique properties. In other cases, it may be due to credit issues or lack of verifiable income when recently self-employed. In the latter examples, a private mortgage satisfies a short-term need, such as lowering payments or purchasing a house, and we then put a plan in place, working towards the goal of securing more favourable mortgage with an institutional lender as soon as possible.

Contact Canadian Mortgage Authority, your Hamilton Mortgage Broker, and Grimsby Mortgage Broker today.

Mark

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