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Using our expert private mortgage brokers as a resource will enable you to manage your finances well.
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It is our pleasure to offer clients quick and reliable private mortgage solutions in Toronto.
Private mortgages are loans obtained from another individual or company instead of borrowing from a bank or financial institution. A private mortgage lender is an individual or institution that lends its own money out to others. In that case, expert private mortgage brokers at Shant Nalbandian can connect you with a broad network of private mortgage lenders to find the loan that fits your financial needs.
Whether you live in the big city such as Toronto or a small town of Ontario, getting a private mortgage is always a wise decision. It is very common for private mortgage lenders not to lend money to everyone, and this is where private mortgage brokers are helpful. However, private home loans are a great way to get the funds you require from a reputable source. Individuals with special loan requirements may face difficulties since the conventional lending industry has many strict lending guidelines. On the other hand, private lenders work closely with their purchasers to deliver their special needs.
Private Mortgages in Toronto are typically transferred to Mortgage Investment Corporations, where money is brought in by investors to fund mortgages. Private lenders do not require down payments from the public, so they are not managed by the federal or provincial governments.
In comparison to traditional lenders, they charge a higher interest rate and fees. They often serve as a great bridge before you rely on traditional mortgage lenders.
In some circumstances, a person can even prepay all the interest on a loan when it's funded and deduct that amount from the total loan amount so that there is no monthly payment to make.
Despite the benefits of a monthly interest-only plan, an individual may choose to defer payments on a private mortgage Toronto to the end of the loan term, which is known as an accrued interest arrangement.
It is also possible to set up an amortized blended payment plan, which unifies interest and principal payments into a single monthly payment, just like a traditional mortgage, in order to build up additional equity on home.
You may be able to lower your monthly payments with a blended amortized mortgage if you extend the amortization period up to 40 years.
"Find out more information on Private Mortgage in Toronto by contacting Shant Nalbandian."
Private mortgages are usually short-term loans, which typically last from a few weeks to several months, and some may even last for over three years. The mortgage loan will go into default upon the end of the term, or you may choose to renew the mortgage with the current lender.
The typical private mortgage tenure is one year, with a minimum of six months and a maximum of three years possible. However, short-term mortgage rates can even be higher sometimes.
It is common for a borrower to refinance mortgage with a new lending partner to repay the private mortgage. The objective is to develop a plan that allows to exit a private mortgage as soon as possible and secure a conventional mortgage at a lower interest rate.
The interest rates on private mortgage in Toronto are determined by the loan amount, the cost of the property, the location of the property, and other factors as well. Private mortgage interest rates can range from 3.99% to as high as 13% for a first mortgage, and as low as 6.99% to as high as 18% for a second mortgage, depending on the many factors that matter to each mortgage lender.
Private investors are able to offer a better interest rate than a MIC since a MIC needs to pay a higher rate of return while simultaneously taking extra interest.
Since private lenders in Toronto typically charge higher interest rates than conventional mortgage lender, borrowers only look for a private lender when they get turned down by the banks and by other lenders such as Duca Credit Union, Equitable Bank, or Hometrust.
Let’s say a homeowner in Toronto needs to borrow $300,000 to buy a property valued at $400,000 and the bank turned them down because either the person has bad credit or is self-employed and has non-traditional income documentation. Here's a simple formula to figure out how much the monthly payments would be:
Monthly Payment and Interest Calculation Formula:
Monthly Payment = Total Interest Amount for the Year ÷ Number of Months in the Mortgage Term
First, calculate the total interest for the year:
Total Interest Amount for the Year = Annual Interest Rate x Total Mortgage Amount
Total Interest Amount for the Year = 5.5% (monthly interest rate) x $300,000 (total mortgage amount)
Total Interest Amount for the Year = $16,500
Second, calculate the monthly payment amount:
Monthly Payment = $16,500 ÷ Number of Months in the Mortgage Term
Monthly Payment = $16,500 ÷ 12 months
Monthly Payment = $1,375
The calculation shows, at the end of 1-year term a person would have paid a total of $16,500 of interest by making 12 monthly payments of $1,375 a month. And still owe the entire $300,000 in principal back to the lender.
Or you can simply use our mortgage calculator to get a quick estimate on your monthly mortgage payments.
If one's credit score is below 580/600, the person is unlikely to get approval from a prime lender and even institutional lenders for bad credit will probably deny it.
A person who has bad credit is luckily able to turn to lenders who can offer them with various mortgage options.
Mortgage process can be hectic sometimes, and to deal with it we suggest you contact our private mortgage brokers team and get ideal assistance regarding private mortgage Toronto.
Getting a private mortgage loan in Toronto is usually far more straightforward than getting a standard mortgage loan. Typically, in Toronto, the monthly payment is solely based on the interest charges, resulting in lower expenses than a conventional mortgage.
Private lenders usually provide mortgage on deals that banks see as being too risky. Due to such risks, lenders place more emphasis on different factors than banks.
Private lenders look for the following characteristics when assessing a potential borrower and the mortgage they are seeking:
Saving on interest payments is usually possible by investing a larger down payment. The increased investment also tends to indicate increased confidence of the lender, which makes it more likely for them to grant a private mortgage at a lower interest rate. Therefore, a low interest rate translates to a lower closing cost, which is why a higher down payment is typically advised.
These behavioral tips will also help you get a private mortgage loan in Toronto:
Shant Nalbandian can help you get immediate approval on a private mortgage in Toronto and find the best private lenders for your particular financial situation to provide you with the best possible rates.
A private mortgage lender has the following disadvantages:
Those with credit scores below 680 are likely to need a private lender. Mortgage lenders can use the credit score to assess the financial status of borrowers. This can easily demonstrate whether a person should get an approval on a mortgage or not.
Your credit score can be improved in certain ways:
CMHC mortgage insurance requires a minimum credit score of 680. Since many B Lenders have only insured mortgages, those who cannot get coverage from CMHC are unable to apply. In spite of a 20% down payment, lenders may require mortgage insurance.
Getting a conventional loan could be your best option. However, if you wish to protect your finances, private mortgages may be the perfect solution. Most people used to think of private mortgages as the last resort option, but that is no longer the case. Private mortgages are ideal for anyone and everyone, especially if you want a personalized experience and an easy-to-understand process.
Traditional lenders differ from private lenders in many ways, and depending on the circumstances, these differences may play a greater role.
Below are the three most common types of private mortgage lenders:
Private mortgage agents help borrowers for many reasons. Here are some of the most common reasons to consider private mortgage broker such as Shant Nalbandian:
The lowest mortgage rates and loans are offered by Shant Nalbandian, one of the leading mortgage experts and financial advisors in Ontario. Whether it's about refinancing a mortgage, consolidating debt, deciding on a second mortgage, or obtaining a home equity line of credit or looking for a private mortgage in Toronto, we provide exceptional solutions for your different financial needs. Having relationships with financial institutions across the financial spectrum to provide choice and opportunity.
Shant Nalbandian is a Toronto based mortgage broker and financial advisor with multiple years of experience helping clients realize their financial dreams. Since every financial situation is unique, Shant Nalbandian and his team treat each client as an individual and provide unexceptional services.