Top 4 Advantages of Private Home Mortgage Lenders

 

Is the Canadian Government doing a good job of encouraging institutional banks to make mortgages accessible to all citizens?

For some the answer is no.

Today we look at a home loan / equity lender alternative that some individuals may find better tailored to fit their needs.

Gradually, more individuals are learning about the key advantages of private home mortgage lenders.


2 Bad Habits by Private Mortgage Lenders – And How You Can Avoid Them

 

Private mortgage lenders can be a very useful resource for difficult situations requiring short-term financing. Their flexibility in difficult situations compared to traditional banks gives them considerable appeal.

However, potential borrowers should use caution. Like any other industry there are professional and not-so professional individuals.

Aggressive private mortgage lenders can entice borrowers to enter agreements that may be difficult to resolve without added expense.

Here we will go over a few of the bad habits seen by less reliable private lenders and why using a mortgage broker / administrator is a smart decision.

 


Private Mortgage Investors or Loan Sharks?

 

Not too long ago getting approved for a mortgage was a piece of cake. Lenders have since tightened their lending restrictions. For some borrowers getting approved is harder than navigating a minefield, one wrong step can blow up the entire deal.

In the past if you had one piece of the application process not line up yet another was stronger, lenders would sometimes overlook the problem, today that does not happen and deals are declined.

Reasons for borrowers getting declined include:

  • Debt ratios too high
  • Not enough provable income
  • Credit history is shaky
  • Employment history not long enough
  • And the list goes on…

Private Lender versus Institutional Lender

 

I often get asked if using a private lender is a wise choice.

Before I answer that question, let’s first compare a private mortgage with an traditional mortgage.

It is important to understand the difference between what a private lender and an “institutional lender” look for when considering an applicant: