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Why A Private Mortgage May Be Right For You

Why a Private Mortgage May Be Right for You

Is a Private Mortgage Calgary a solution for you?

If you have paid any attention to Canada’s current mortgage outlook then you are aware of several things happening. For example, you likely know that interest rates are on the rise and the Canadian government introduced new regulations that made it more difficult to qualify for a mortgage.

With interest rates over the past year or so having been as low as they have ever been many Canadians took advantage and sold or purchase a home. The demand has been present, which in turn drove prices skyward, and has forced the government to bring in the new rules to do what it can to slow down the red-hot markets and overpriced properties.

But what does this mean for people, especially younger ones, who still want to purchase a home but simply can’t afford to qualify for the national banks’ posted rates? The answer is actually simple: get a private mortgage.

A private mortgage is an ideal solution for many people, ranging from those who are self-employed, own a low credit score, are foreign investors, and more. Private mortgages don’t own the same restrictions that a typical bank mortgage would carry, thus offering increased freedom and wiggle room depending on specific situations. If you are having problems qualifying for a mortgage with a bank (for whatever reason), a private mortgage could be the solution you need.

Let’s look at a scenario:

A young couple who have previously owned homes separately but have since sold for individual reasons. They are left with a bad credit score. Furthermore, one is going through a career change while the other is in an entry-level job position. They decide that they want to purchase a home together.

Thanks to the new regulations they are unable to qualify for a traditional mortgage through a bank. They turn to a broker who can get them a private mortgage, where they can easily qualify and get the financing they require to purchase.

A private lender is able to take on your loan despite you being what banks would declare more of a “high risk” case. Thanks to a private lender, you can secure the loan needed to purchase the home you have always wanted rather than watch it slip away.

Private lenders are typically more expensive than what a traditional mortgage might be, but it gives you the flexibility you need to secure a loan and is outright the best option for those who are unable to go through a bank. They are also ideal if an emergency were to arise and you are in need of additional finances in a timely manner.

With home sales in Calgary back on the rise, combined with the difficult qualification requirements from lenders, could a private mortgage be the right fit for you? If you don’t believe that you are able to qualify for a mortgage through a bank or are in need of cash fast, consider reaching out to a private mortgage Calgary professional. We would be more than happy to help you.


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  • author's avatar

    By: Dan Heon

    Dan Heon is the owner and broker of Mortgage Centre / Canadian Mortgage Team Alberta. He has many clients all across Canada that rely on his 18 years of real estate investing and his 13 years of mortgage broker work specializing in real estate investors. In 2010 Dan was ranked 16th in Canada out of over 20000 licensed mortgage professionals according to CMP magazine. Dan’s motto is, “Plan your finance… then finance your Plan!” According to Dan he gets paid by the Banks to help make people millionaires!

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