If you need money quickly, bad credit and not able to verify your income. Private mortgage is the best solution.
A private mortgage in Ontario is a mortgage loan that is provided by an individual or a private lending company, rather than a traditional financial institution like a bank or credit union. Private mortgages can be an option for borrowers who may not qualify for a conventional mortgage due to factors such as poor credit history, self-employment, unconventional income sources, or unique property situations. Here are some key points to understand about private mortgages in Ontario:
Private Lenders: Private lenders can include individuals, private lending companies, mortgage investment corporations (MICs), or other alternative lending sources. These lenders typically have different criteria and may be more flexible in their lending requirements compared to traditional lenders.
Interest Rates and Terms: Private mortgages often come with higher interest rates compared to conventional mortgages. The interest rates can vary depending on factors such as the borrower’s creditworthiness, the property’s value and location, and the loan-to-value ratio. Private mortgages may have shorter terms, typically ranging from a few months to a few years.
Loan-to-Value Ratio (LTV): Private lenders typically consider the loan-to-value ratio, which is the loan amount as a percentage of the property’s appraised value. Private lenders may be willing to provide a higher LTV ratio, allowing borrowers to access more funds even with a lower down payment.
Fees and Costs: Private mortgages may come with additional fees and costs, including origination fees, broker fees, legal fees, and appraisal fees. It’s important to understand and factor in these costs when considering a private mortgage.
Exit Strategy: Private mortgages are generally considered as a short-term solution, and borrowers are expected to have an exit strategy. This could involve refinancing with a conventional lender, selling the property, or using other means to pay off the private mortgage within the agreed-upon term.