Why You Should Invest as a Private Mortgage Lender

Nothing beats diversification when it comes to building a solid investment portfolio.  Where to find a good investing opportunity then? The stock market is a favourite for many, but it comes with a high level of risk. You’ve also got government backed securities, something that offers little risk but is at the mercy of inflation. Why should it bpm2e a case of choosing the lesser evil when you can have the best of both worlds?

Do you know that private mortgages carry very minimal risks and offers a great ROI? That does sound great, doesn’t it? But if you’re not convinced yet about investing as a private mortgage lender, here are 5 reasons why being a private mortgage lender rocks:

Has Better Rates Compared to Banks

Private lenders can charge higher rates than banks, and consequently, can make more money than banks. With so many people having the ability to pay a high down payment but lacks the income verification or credit score to seal a deal with a bank, you won’t run out of buyers, more so if you factor in savvy brokerages who’ll connect you with such people for the benefit of all parties involved.

It Beats Being a Landlord

Being a landlord means having to take care of repairs and maintenance, both of which can get very expensive. Selling the property and acting as a private lender means you still get a steady source of income without having to shell out some cash for future repairs.

Saves You the Hassle of Dealing with Flakers

Buyers behave much better than renters. Why? Because as a private mortgage lender, you’re their lifeline back to better credit. Of course buyers can still present a risk, but if the buyer has put in around 30% down payment, there is actually less risk for you because it shows that buyer has some financial skill.

You Get to Set the Loan Terms

You don’t have to follow fixed rates for 15 to 30 years as a private lender. You can apply adjustable rates as long as the buyer agrees to it. The loan terms and duration can be exactly how you want it to be. Shorter terms means that you can get your investment back sooner so you can move on to more and better investments while longer terms presents you with a more predictable cash flow.

Lending Decision is All Yours

You don’t have to base your lending decision on the borrower. You set your terms and down payment your way. A large down payment means that the risk of default will be a lot less and the likelihood of the borrower falling behind on payments less of a worry too. Even in the case of default, you still can get a healthy profit from of selling the property.

Finding buyers and clients need not be a chore as a private mortgage lender. There are brokers like us that help buyers and clients find private lending sources like possibly you! Have any questions on private lending and how this can work for you? Contact us today!

 

5 Ways to Turn Your Bad Credit Around with Refinancing

No one finds bad credit attractive. It is even much worse when you need to borrow from credit facilities because it shows all the skeletons in your borrowing history. Times when you’ve defaulted in your payments for one reason or another such as failing to pay on time can gravely affect a lender’s decision to give you mortgage. A pending loan that got out of hand and bad credit from previous borrowing will magnify the problem even more. If you’re aware of all this, then there’s hope in the horizon!

What to do then? How can you boost your credit score? Proactively trying to keep your financial health in good condition can prevent you from achieving worse credit in the future, but how?

Applying for a refinancing to get a new loan with better terms and payment plan can save you a lot of money. New mortgage terms can help you pay back your debt and therefore boost your credit score. Sounds like a plan? You bet!

So how can you get a new loan when you have a bad credit history? Here are tips to help you get refinancing at much better interest rates:

Tidy Up Your Paperwork

Wrong information can break your credit score. Check your credit documents and see if the information contained therein is valid. Rectifying errors can make you more eligible for refinancing at lower interest rates.

Make it Personal

You need to make your lender understand why you have a bad credit situation and the best way to do that is to meet your lender in person. By helping your lender understand your situation, you’re letting them see what you’re doing to pay back and that you care.

Know Your Ability to Pay

Things change, and what you can afford to pay a few months ago may be totally out of what you can afford now. The good news is that you can change your loan terms to help make payments easier for you. How can you do that? By refinancing! But remember that you have to be able to convince your lenders that you have the ability to pay your new terms. One thing you can do to convince them is to show proof of your ability to pay by depositing some money in the bank or by showing proof of your expected revenue. This often leads to favourable payment terms with lower interest rates so be sure that you can hold your end of the bargain!

Have Strong Guarantors

Pick your guarantors right. The people guaranteeing your loan should have a better credit rating and score than you because this shows lenders that your guarantors believe that you have the ability to pay your mortgage. After all, being a guarantor means they’re willing to pay your loan should you default on payment. Establishing that you have a low risk of defaulting will make your lender more willing to refinance your mortgage at more favourable rates.

Shop for a Better Lender with a Strict Loan Policy

Your main goal should be to get a better credit rating/credit score and to get out of debt, so don’t be tempted to go for loans with tempting terms such as those that allow you to withdraw extra payments. Facilities that tempt you to spend more are no better than parents who spoil their children and will do you more harm than good in the long run.

A better mortgage package means that you don’t have to borrow again, because hopefully, you’ll be able to have a better hold of your financial health. A great mortgage broker can guide you to the best lenders who can offer you the best rates and terms.

Looking for a mortgage consultant in Ontario to help you apply the tips above? Allow us help you with our 60 years of industry expertise fixing bad credit and helping people like you with their mortgage. Contact Homebase Mortgages today!

 

It Pays to Use a Toronto Mortgage Broker

When looking for a good conventional or private mortgage, you’re going to want to work with a Toronto mortgage broker. They’ll be able to help you find the right first or second mortgage for you; here we’re going to talk about what you need to look for when hiring a broker and getting a mortgage. Make sure that you know who you’re working with before you consider any deals! So let’s find out what a mortgage broker is, what they do and how they’ll put your money to work for you.

What is a Mortgage Broker?

Mortgage brokers are like your go between when you need a mortgage; instead of going to a single lender and hoping you’ll get the right deal, you’ll know you’re getting it. They can negotiate down the lowest fraction of a percentage point on a second mortgage or even a private mortgage, but they’ll also be able to help you figure out what kind of financing and lender is right for you. You shouldn’t have to spend a lot of time and money finding the right one, and they’ll be able to work towards your interests and help you get the right deal.

How is Working with a Mortgage Broker?

If you’re trying to find the best second mortgage or private mortgage, they’ll be able to help you get there. They’ll first take down your information in a mortgage application, just like any other lender would. They’ll help you evaluate your application so you can spot any errors up front and avoid any problems during the application process. It’s a well-known fact that most lenders will give your application a cursory glance and if they spot anything wrong with them they’ll just throw them in the trash.

After making sure that your application is where it should be, they’ll help you apply to many different lenders. When working with a Toronto mortgage broker you’ll want to make sure that you apply to as many lenders as possible at once; when a lender first queries your credit report you’ll have about 2 weeks before it starts counting against you again. You want to get them all out of the way at once so you’ll be able to get what you need done now without hurting your credit.

What is Right for You?

Figuring out what’s right for you when it comes to a Toronto mortgage broker can be difficult, but they make the process a whole lot easier. From finding errors in your paperwork to figuring out what you can do to repair your credit before finding the right lender, they make applying easier. When you’re ready to apply, they’ll be able to help you find the right second mortgage, private mortgage or any kind of mortgage. There are many different kinds of lenders, and unless you’re the best negotiator you may not be able to get the best rate; let a Toronto mortgage broker help you find what you’re looking for and save money today.

Click here to apply online for free today!

Three Ways Mortgage Brokers Help First Time Home Buyers

If you’re a first time home buyer, you may not know that you have options for loans! You’re not just dependent on a bank to give you the best deal, and depending on the size of your mortgage a mortgage broker will help you get the best rate for a steal of a deal. One thing you need to know is that a Canadian mortgage broker is the best option for first time home buyers; you’ll be able to talk with them face to face and ask questions you may have about the process.

Someone You Can Talk to

Banks are notorious for not picking up the phone when customers call, and if you have a question about interest rates you may be out of luck. Loan officers are over worked and underpaid, often are just trying to meet a quota. Your goals are not their goals, and they’re trying to maximise the profit for the bank not the benefits to you. With an experienced mortgage broker, you’ll be able to speak with someone on the phone or face to face, ask how the process works and really understand what you’re signing up for.

Get Better Rates

If you’re getting a $250,000 mortgage at 4%, you’ll pay $10,000 a year in interest. If you get a 3% interest loan for instead, you’ll only pay $7500 a year. Over a 15 year period you’ll save almost $38,000 in interest, so those little percentage points make a big difference! There are many different mortgage brokers on the market (especially online), but it’s best to go with a Toronto mortgage broker who has the relationships with the lenders to get you the better deal.

Someone Who Works for You

Since they’re hired by you and only paid when the transaction is completed, you’ll be able to get a second mortgage or a first mortgage to buy your dream home or pay down your debts. They’ll be able to help you know how much money you have to spend on a home and get prequalified before you even start shopping for a new home. You can save yourself a lot of heartache when the bidding wars begin when you know what your true budget is before you start looking at homes that are just too expensive.

What a Mortgage Broker Actually Does

When you want to buy a home, refinance your current mortgage or take on a second mortgage, a mortgage broker will help you get it. A mortgage broker is an independent agent that works for you, and is typically paid after the deal is complete. They’ll give you a wider variety of choices in different lenders and interest rates, so you usually will get a better deal. Depending on the size of your mortgage, the savings will be different.

So now you know how mortgage brokers help first time home buyers get the best deal for their money; they provide a better experience and more attention than a traditional loan officer.