Private Mortgage Oshawa

Private mortgages are home loans that are offered by private individuals and companies rather than by traditional lenders such as banks and credit unions. A private lender may be a person or company that regularly invests in private mortgages as a way to generate income or it may be a friend or family member who is providing the loan as a way to help the lender achieve their dream of homeownership. Whatever kind of private mortgage you are considering, it is always best to work with a qualified mortgage broker to ensure that everything is set up legally and in a way that benefits both parties.

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Private mortgages can be an ideal solution for borrowers who cannot qualify for a traditional mortgage. This may be due to damaged credit or not being able to pass the federal mortgage stress test. It may be because the lender is unable to prove their income due to the fact that they are self-employed or a newcomer to Canada. Or perhaps it is because they wish to purchase a home that does not qualify for a traditional mortgage such as a mobile home or tiny house. As you can see, people choose private mortgages for a variety of reasons, not all of which have to do with poor credit.

Before opting for a private mortgage, it is important that you understand both the advantages and disadvantages. Especially if you are considering a private mortgage from a friend or family member, you will need to consider how such a loan might affect your relationship with that person. Private mortgages through a company or professional investor tend to have higher interest rates than traditional mortgages but they can still be a good short term solution if you need time to build or repair your credit.

Whether you choose a private mortgage or a traditional one, it is important that all the contracts are in proper order for both tax and legal purposes.