Private Mortgage Tips From Mortgage Broker Mississauga
Private mortgage lenders are institutions or individuals who can be considered a lifesaver when someone gets their loan request denied by a traditional mortgage lender. Private lenders offer short-term financial solutions that can be used to purchase your dream home, refinance, pull out equity from your home for whatever you may need it for, such as consolidating or paying off debt, paying for your children’s education, or for investment opportunities.
In Canada, many people take out mortgages from various private mortgage lenders as they are a fantastic alternative to traditional financing in most situations. Our team at Mortgage Broker Mississauga has put together this blog for you and has below a few reasons why you should consider getting a private mortgage. If you have any questions while reading along, please reach out to our team to get answers to your questions regarding getting approved for a private mortgage.
Reasons Why You Should Consider Getting a Private Mortgage:
- When you are considering purchasing property, but the traditional lender is not ready to provide you mortgage financing.
- You require a short-term loan for only a couple of years.
- You want immediate mortgage financing without having to deal with the lengthy approval process in a bank.
- You have a poor credit history which makes you a high-risk individual to banks and other traditional mortgage lenders.
- You are a self-employed individual that cannot provide proof of income.
- You want to use the equity in your house to refinance and consolidate debt.
- You are looking to purchase an unconventional property.
How to Save Money with a Private Mortgage?
Saving money for a rainy day or other investment needs is a sound financial practice. There will be times you will need to pay a large amount, and you don’t have enough funds in your bank account to pay for it. A few of these expenses may include – home renovations, overdue bills, outstanding loans, medical expenses etc. This is where a private mortgage can be of great help to you. Let our Mortgage Broker Mississauga team see how much money we can save you from a private mortgage:
- It helps in consolidating your credit card debt
A private mortgage can be used as a debt consolidation tool as private mortgages have a lower interest rate than credit cards and this is very reason why you should consider paying off your credit card debt by taking out a private mortgage. Our team at Mortgage Broker Mississauga can find you the right private mortgages specially created for this very purpose. If you are finding it difficult to pay off your outstanding credit card debt due to its high-interest rate, a private mortgage with a low rate of interest is the perfect option to clear your debt and save money in the process.
- It helps with increasing your credit score
By getting a private mortgage to pay off all your debts, is the single best way to improve your credit score rating. This is because when you pay off all your debts in full, your credit score increases as the debts reported to your credit report have been cleared and have meet their financial obligations. All you will need to do moving forward to further increase or maintain a better credit score, is maintain on time payments for all your bills and loans and over a course of a year, you should see your credit score rating significantly improve.
- It helps you in funding a one-time major expense
There will be moments in life when you will be required to make a sizeable one-time expense; it can be for your children’s wedding, purchasing your dream home, an investment etc. A private mortgage is a most readily available way to borrow money in a short period of time to cater to that large expense. Private mortgage lenders generally allow the borrowers to use the private mortgage for practically anything. As mentioned above, either for a wedding, purchasing property, or even a one-time medical procedure. The only drawback is many uses a private mortgage for non-critical expenses. It is best advised to save up for these significant expenses, if possible, instead of going into debt. Additionally, suppose you end up missing out on a payment or default. In that case, it can cause serious implications leading to your credit score being impacted, making it challenging to apply for mortgages in the future.
- Flexible than other mortgage options
Private mortgages are more flexible than other mortgage options. The borrowers can agree to a repayment term that may range from six months to one year. A wise strategy is to let go of the high interest quicker by taking out a private mortgage to consolidate multiple high-interest debts. Paying your mortgage off early can help you save hundreds and thousands of dollars in interest. But before you take out a private mortgage, just ensure the lender does not charge you with a pre-payment fee.
As you can tell by now, a private mortgage has many uses and can provide you with short-term financial help for any financial situation you may have. Such as using a private mortgage to refinance credit card debt can save you a substantial amount of money if you secure a lower interest rate on the mortgage, and the amount saved can be used to fund your long-due vacation, purchasing a property, or just paying off high-interest debt and saving yourself hundreds and thousands of dollars in the process. However, you must keep in mind that taking out a mortgage that you cannot afford to repay can put you in a difficult spot financially and can have the potential to ruin your credit score if you miss out or default on your monthly payments.
To get more information on private mortgage Mississauga and to find out how a private mortgage can work to your benefit surrounding your particular situation, make sure to contact our team at Mortgage Broker Mississauga today and schedule an initial consultation. Our team is here to help you reach your financing goals and make the process of obtaining a private mortgage simple and easy.