Figuring out if a private mortgage is the right choice for you can be difficult, but that’s why you need to understand your options. Just because you have bad credit or no credit at all doesn’t mean you have to go the alternative financing route. Private mortgages in Canada carry the same risk as any other kind of mortgage; what you’ll want to be careful about is how much you borrow and how fast you’re going to pay off your loan. Here we’re going to go over a few different things you need to know about financing your home, so let’s get started!
What Are Private Mortgages?
Private mortgages give you the flexibility you need to borrow, but they also give you the security of a traditional loan. These are made by lenders just like a regular loan, but instead of going to a bank you’ll need to go to a Toronto mortgage broker to get in contact with different lenders. You don’t want to do this part on your own, and a mortgage broker is only paid after you’re satisfied with your choice of lending and everything is closed out. If a mortgage broker tries to get you to pay up front, find another. Their fee comes out of those fun closing costs you pay when ownership of the home is transferred to you.
How Are Private Mortgages Different from Regular Mortgages?
A private mortgage is different only because of who is lending the money and who is borrowing it. Many traditional lenders won’t loan money to people who are self or seasonally employed; you may be retired or you may run your own business and have a hard time proving income. You may have a bad credit history you’re working on. Either way, you’re going to need a mortgage broker to help you through the process and to get the financing that you deserve to get you on your way.
Do You Need a Private Mortgage?
Situations vary greatly from person to person, but it never hurts to explore your options! You’re going to want to go over the paperwork with someone who knows what they’re doing, and this is why you need a mortgage broker. You shouldn’t have to go it alone, and with the right help you won’t have to.
How Much Do Mortgage Brokers Cost?
They work on a nominal fee; this can be 1% of your mortgage or it could be $300. It will range from broker to broker and you’ll want to be careful about selecting your broker solely on the basis of cost. You won’t always get what you pay for when it comes to mortgage broker, so make sure you ask around and look at reviews of different companies online. This way you’ll be able to maximise your chances for getting financing; then you’ll be able to get your private mortgage and save money all at the same time!