Private mortgage rates vary wildly depending on the lender and even on the availability of their money at the time you need it. Here is what you need to know in order to secure the best rate for your situation.
Loan Shark Beware
In your pursuit of your best private loan there is a character to be aware of. It is very difficult to know for sure who this wily creature is at first meeting.
The loan shark can be very convincing that they offer you all the benefits of a good private mortgage lender. They say all the right reassuring phrases and everything is ‘Yes’ and ‘Amen’ until a later date when they reveal their true nature.
When it comes to the interest rates they charge it can be deceiving as the first number promised can and usually will change before you receive the funds.
A Story Of Woe
Nancy believes she has secured a private mortgage loan of 100K in 2nd position behind her bank mortgage and the lender she is dealing with offered her a verbal interest rate of 8% over the phone communicated through her broker.
Weeks go by and there is no paperwork supporting this rate. Just a lot of reassurances from this broker.
Then she receives a call from a lawyer to come in and sign documents and she finds that her actual rate is going to be 12% and there are hidden lender fees on top of that. She feels pressure to sign as it is stated that there was a lot of work put into this for her and that the lender will sue for costs owed to the lawyer if this doesn’t go through.
As you can clearly see – not all Ontario private mortgage lenders are created equal.
Private ‘Angel’ Lenders
There is a defence against the greedy loan shark who preys on your vulnerability. I work with what I consider the ‘Angel’ class of private mortgage lenders.
These lenders are normal citizens like you and me who have done well in their investments or business and are looking to give others a hand up. Although it is not charity, I believe you will see how their approach is also in your best interest.
All private mortgage lending is risk based. All lenders will consider the risk and price your loan accordingly.
The difference with an ‘Angel’ private lender is that they are also willing to consider your story. This is evidenced in their willingness to take your highest needs into consideration and even be open to negotiating the interest rate.
My experience has been that private mortgage borrowers truly appreciate being shown respect even if they are in a vulnerable position and this type of lender does this very well.
Find out more about all of the things you need to know about your Private Mortgage Made Easy
Private Mortgage Interest Rates
As I mentioned in the opening of this post, private lending rates vary wildly. With this said there are rough numbers that can be used to ensure you are on the right track.
- First Mortgage Rates – If you are borrowing a private mortgage in 1st position without another lender already having loaned you money you will be paying between 6 – 10% interest.
- Second Mortgage Rates – If you are borrowing a private mortgage in 2nd position and already have a bank mortgage loan against the property you will be paying between 10 – 15% interest and higher.
It is very important to know with an iron clad guarantee what your interest rate will be for your best private mortgage loan.
With loan sharks you will be left in limbo with an ever growing, sinking feeling that you are being set up to be taken advantage of in the end.
On the other hand, you can experience the satisfaction of an honest, ethical, and fair transaction with an ‘Angel’ on your side. Your loved ones will thank you for your efforts. Get your best interest rate today by reaching out to me below.