Best Private Mortgage Lender in Toronto for 2022 – Get Approved in 30 Seconds
A private lender is a person or business that loans money to someone but is not connected to a financial institution such as a bank, credit union, or finance company. Getting approved for private mortgages in Toronto is quite simple through our expert mortgage brokers at Approved Equity
Who is a private mortgage for? Private mortgages are often meant for short-term solutions. Typically a private mortgage is a solution to someone after a traditional bank or lending institution will not approve a current or potential homeowner for a mortgage or a home refinance loan.
Why Do People Get Private Mortgages?
Private mortgage lenders in Toronto generally have faster approval times than traditional banks, with a streamlined and informational application process that is more property-focused with credit and employment history being secondary factors. Our private mortgage lenders in Toronto lend based on equity, not the borrower.
Here are some of the main reasons people go to private mortgage lenders in Toronto:
- Homeowners with bad credit scores and financial challenges
- Borrowers with inadequate credit to qualify for a traditional bank mortgage
- Self-employed borrowers with unverifiable income
- Non-residents of Canada
- Emergency funding for those going through foreclosure, Power of Sale or those with property/income taxes in arrears
- For mobile homes or micro-condos (less than 600 square feet) that often can’t be financed/refinanced through a bank
- For second mortgages and investment properties
- You are buying a non-traditional property that a conventional bank or institutional lender will not approve a mortgage for.
- For individuals that only need a short-term loan.
Get the best private mortgage loan rates in Toronto through Approved Equity. Whether you are looking for a private mortgage lender in Toronto as a first-time buyer or looking for a private mortgage for bad credit, Approved Equity has a proven track record to get you approved in 30 seconds.
Different Types of Second Mortgage Loan Options with Private Mortgage Lenders in Toronto
Different types of second mortgages through a private mortgage lender in Toronto is a great option for many homeowners as it provides the flexibility of utilizing one’s assets (equity). A second mortgage is when you borrow against a home’s equity that’s already mortgaged using the current home equity as leverage for additional mortgage financing. There are many types of second mortgages available to Toronto homeowners. Here are some typical second mortgages a private mortgage lender in Toronto can help you obtain:
- Home Equity Loans: A home equity loan is a type of loan in which the borrower uses the equity of his or her home as collateral. The loan amount is determined by the amount of equity in the home. To determine how much equity is in the home, we need to first determine the property value. Approved Equity will assist in obtaining the true current market value of the property, and the value of the property is determined by an appraiser.
- Debt Consolidation Loans: A debt consolidation loan is a way to refinance your debt. You’ll apply for a loan for the amount that you owe on your existing debts, which we usually get approved within 24 hours. Then, you’ll use the funds to pay off your debt balances. Approved Equity’s Private mortgage lenders in Toronto specialize in getting borrowers approved for debt consolidation loans. This way you can reduce your exposure to high-interest credit card debts by consolidating your debts into a low rate debt consolidation loan.
- Home Equity Line of Credit ( HELOC): A home equity line of credit (HELOC) in Canada is a great way to access some of your home equity. Since it’s secured against your home, you’re able to borrow at much lower rates. And, you can access funds as often as you like as you pay them down. You also only pay interest when you have a balance. This is a terrific solution for business owners who make daily purchases and are paid sporadically. We Have many lenders offering HELOC’s to homeowners.
- A Second Mortgage: A second mortgage is a secured loan that’s registered behind your existing mortgage. This secondary placement enables you to keep your first mortgage options and rate while tacking on additional funds with a new mortgage. If you have a mortgage on your house, the home equity is the difference between the value of your house and what remaining mortgage balance. Our Private Mortgage Lenders in Toronto lend strictly based on equity and not credit income.
- Home Renovation Loans: Home renovation loans are the smartest way for homeowners to finance their home renovation projects. Many people in Toronto can’t afford to pay for home renovations in one shot and turn to private mortgage lenders in Toronto to get approved for loans to pay for home renovations.
- Bridge Financing –If you are in the market of selling one home and buying another, there is a good chance that bridge financing will come into play. Bridge financing provides a bridge between selling your home and closing on a new home by tapping into equity. A bridge loan is an extremely short-term loan, typically, between 1 to 6 months, with only interest charged during the loan. As an example, If say your closing date for your current home is 80 days away, while the closing date for your new home is in just 30 days. A bridge loan will cover your equity over the 50-day period.
Who Can Get a Private Mortgage in Toronto?
As long as you have equity, we have lenders to provide you with a competitive offer for Private Mortgages. Our Private Mortgage Lenders in Toronto are able to close fast and lend purely based on equity. Not credit or income.
First-time Home Buyers With Bad Credit
Credit history is just one aspect of your mortgage application file. Buying your first home can be a daunting task with bad credit, however, Approved Equity specializes in its network of private mortgage lenders in Toronto to help give people their first homes.
It can be hard for new immigrants to get a mortgage due to a lack of credit information in Canada. Credit reporting agencies in Canada such as Equifax and TransUnion collect information only in Canada, making it hard to judge if a new immigrant with a lack of credit history will qualify for a mortgage. Combined with the fact that new immigrants have a short employment history in Canada, it makes it even harder to get a mortgage as a newcomer. Private mortgage lenders in Toronto are a popular option for newcomers to get a mortgage, especially when they lack the credit and employment history needed from large banks.
Banks typically require about two years of employment history to prove that a potential homeowner has a steady source of income. Self-employed income can be both unsteady and inconsistent. Self-employed income can vary from year to year and the type of income is tied to things such as commissions, tips, sales for your business, and billings that fluctuate monthly which can be hard to show to typical mortgage lenders. Banks often require two years of employment history to prove that they have a steady source of income. Getting a self-employed mortgage presents challenges, such as if your income is not steady and fluctuates significantly.
It can be difficult to qualify for a mortgage with leaning on private mortgage lenders in Toronto, as foreign income is harder to verify. Large banks can require up to a 35% down[ payment with incomes to individuals with foreign income. Banks like Scotia Bank will even require foreign income verification if the down payment is less than 50%, which is less than ideal to qualify for a mortgage in Toronto.
Approved Equity specialized in private mortgages and can help you get a quote in 30 seconds.
When Banks Say No, Approved Equity is Here to Help
When in doubt about the likelihood of getting approved for a mortgage in Ontario, reach out to Approved Equity and our years of experience will be there to not only lend a helping hand, but to walk you through the entire process from beginning to end. Don’t worry about the stage of the buying processes you’re in. Approved Equity specializes in bad credit mortgages in Ontario.
We’re only a call away to start helping you today.
Private Lenders vs Traditional Banks
What Do Private Lenders Look at When Deciding to Lend You Money?
Banks and private lenders look at different things when lending you money. For traditional scenarios, banks look at 7 major things:
- Your credit: Scores range from 400 to 850
- Your income and employment history
- Your debt-to-income ratio
- Value of your collateral
- Size of down payment
- Liquid assets
- Loan term
Private lenders on the other hand aren’t as concerned about your credit score, size of down payment, or employment history. Private mortgage lenders in Toronto may consider the value of the security (for example, how much your home is worth). Private mortgages are a great solution for people unable to secure a traditional mortgage from a bank or credit union.
Approvals for private mortgages are property-focused and less on the individual. In traditional mortgages, the borrower qualifies first based on the ability to repay the mortgage and then the value of the property is the secondary factor. However, for private mortgages, the property qualifies first based on its value and location; the client’s financial situation is a secondary factor.
2 Main Things Our Private Lenders Look for:
- Marketability of Property (We Lend All Over Ontario)
- Sufficient Down Payment or Equity (Our Lenders Lend up to 90% LTV)
Risks of Private Mortgages
Before entering into a private mortgage in Toronto, borrowers need to consider some of the risks involved:
Higher rates – Private lenders typically have higher rates on shorter terms compared to banks and traditional lenders. Approve Equity Has access to the lowest Private Mortgage Rates in Toronto and Ontario
Additional costs – Lender fees and/or broker commissions can add up to thousands of dollars if you’re not working with the right private mortgage expert that has access to lots of Private Mortgage Lenders in Toronto. Also, there are 2 legals expenses paid (Lender’s legal fee and borrower’s legal fee) by the borrower in a Private Mortgage Transaction.
Foreclosure – Private lenders can be quicker than banks to foreclose on your home if you fall behind on your mortgage payments.
Short-term loans – Most private lenders typically only offer a loan for a year or possibly two. Borrowers unable to obtain bank financing at renewal may end up in a cycle of these short-term, higher-cost mortgages.
Interest-only loans – Most private lenders offer interest-only loans. Unlike standard loans, the monthly payments are applied only to the interest – and not the loan’s balance. At the end of the loan’s term, the borrower can find themselves no further ahead with the full balance still outstanding. Approved Equity has access to Private Mortgage Lenders in Toronto that offer Amortized payments which allow you to tackle your principal mortgage balance.
Private Mortgage Rates Toronto
How much does a private lender charge? There are two types of private mortgage lending rates; 1st and 2nd private mortgage rates. Additionally, there is also a lender’s fee that is typically deducted from the loan.
Private mortgage lending rates for 1st mortgage: Private mortgage lending rates may vary from lender to lender. Typically private mortgage lending rates in Toronto for 1st mortgages start at 3.79% and can go as high as 7.95%. Higher rates of 8.99% are also reserved solely for specific types of situations only, but it is rare. Lender fees for private mortgages in Toronto are generally in the 1% to 2% range and are usually deducted from the approved loan.
Private mortgage lending rates for 2nd mortgage: For second mortgages, private mortgage lenders in Toronto can generally charge as low 5.99% to and as high as 11.99%. Lender’s fee also generally from 1% to 4%, but it can also involve fixed fees or rates + a small fixed fee. It all depends on the private mortgage lender your brokerage sets you with. This is why its very important to work with Approved Equity aa as we are Private Mortgage Lending Expert In Toronto and Ontario.
Approved Equity deals with the best private mortgage lenders in Toronto and gets you approved for the lowest rates and fees possible. Why worry about fees and close in on private mortgage in Toronto today.
Private Mortgage Rates Toronto
Most private mortgage lenders only work with mortgage brokers, either by regulation or to streamline the process for efficiency and simplicity. Approved Equity mortgage brokers help you find the best types of private mortgages with the lowest rate and fees suitable for your financial situation. Approved Equity also negotiate with mortgage lenders, and submit documents on your behalf so that you don’t have to worry about the paperwork.
With Approved Equity, a private mortgage can be closed as early as 24 hours, given all lender requirements are satisfied. Apply now for a free private mortgage consultation.
Private Mortgages in 30 Seconds
Why Approved Equity?
- Low Rates
- Approved in under 24 hours
- We deal with bad credit
- Always available. No more chasing down your broker
Approved Equity Has Private Mortgage Lenders in Cities & Towns Across Ontario Including
Sault Ste. Marie