What you need to know about Private Lending in Ontario

1. What you need to know about Private Lending in Ontario Private lending Ontario is on an upswing. Between 2019 and 2021, mortgages offered through private lenders soared 72% higher. Many individuals turn to private lenders for various reasons, including those with poor credit, those reliant on freelance or contract income, and newcomers without established employment histories in Canada. Lower Interest Rates Private lenders tend to offer lower interest rates than traditional mortgage lending because they place greater importance on assessing each property itself rather than adhering to an inflexible set of criteria set forth by traditional lenders when considering mortgage applications. Private lenders will look at factors like market value and existing debts when assessing whether an investment opportunity exists in any particular property. Private lenders typically advise for larger down payments in order to lower risk and get loans with more favorable interest rates. A larger down payment means more "skin in the game", making the loan less of a threat to them and their business. Private lenders may operate independently or as part of a mortgage syndicate or mortgage investment corporation (MIC). Clover Mortgage has developed relationships with many of these types of private lenders and has assisted many clients to consolidate their debt through refinancing with either a new first or second mortgage secured against their home equity. Consolidate Debt and Repair Credit Private mortgage lenders provide financing solutions to Ontario homeowners who do not meet the criteria set by banks due to factors like credit scores, debt ratios or appraised values of their properties. Their lending criteria is more lenient; some are even willing to loan up to 75% of appraised values! Borrowers can utilize a private mortgage to consolidate multiple debts into one monthly payment, simplifying budgeting and improving cash flow. Before selecting a lender, carefully examine its terms and conditions. Take into account interest rates as well as your credit rating, debt-to-income ratio, etc. when making your choice; compare loan offers from several private lenders prior to making a final decision. It is also essential to remember that failing to meet monthly debt consolidation loan payments could severely harm your credit rating. Affordability Private mortgage lenders are individuals or corporations who use investor capital to offer mortgages. Unlike conventional lenders, private mortgage lenders tend to place less emphasis on your past credit history and more on its potential value when financing property. They may be especially helpful if you require funds quickly for consumer proposal filing or bankruptcy proceedings.

2. Banks tend to be less accommodating of individuals with poor or subprime credit - those whose scores fall below 550, or who are self-employed with fluctuating incomes - who do not meet their LTV criteria, such as current home value, debt ratio and source of down payment. They may offer shorter loan terms which mean faster mortgage pay-off and potential savings on interest charges; making this option suitable for those unable to qualify for traditional bank mortgages. Faster Approval Private lenders tend to provide greater flexibility and faster approvals than banks, making them ideal if you are self-employed or have poor credit histories. Furthermore, these private mortgage lenders tend to be more accommodating regarding income verification processes. Personal lenders will still take into account your income and credit score to ensure you can afford mortgage payments, typically up to 65% of property's appraised value. If you are seeking private lender mortgage loans, contact Approved Equity today. Our mortgage brokers specialize in private lending and have access to an expansive network of private mortgage lenders across Ontario. We can help you obtain a private mortgage quickly, easily and without going through banks - call us now for more information on your options! Our rates are highly competitive so contact us now so that we can assist in the realization of your dream home or investment property - many clients who were turned down by banks due to new stress test rules have turned to us instead