Whether you're purchasing your very first home, or your third investment property, we will be there step-by-step to ensure you endure as little stress as possible and offer the best products/solutions for your needs.
Whatever the reason may be for you to refinance your existing mortgage, we will ensure we are providing you with you best options that are the most cost effective. Depending on your existing mortgage, we may refinance with the same lender, or move it to another lender to save you money and/or better suit your needs.
Some reasons for refinancing may include:
Take equity out to purchase another property
Take advantage of lower rates
Pay for your kids education
Typically about 5-6 months prior to your mortgage maturity, we will reach out to discuss your options for renewal. We will help determine whether you are best suited to stay with your existing lender or transfer your mortgage to another lender for a better rate.
PRIME (A) FINANCING
Prime, or A-lenders, are your big banks, local credit unions, and monoline lenders that focus on clients with good credit (typically above a 650 beacon), and conforming/verifiable income. Their guidelines are the most strict and have to comply with OFSI regulations. Since they are the most risk-adverse, they have the ability to offer the lowest rates on the market.
ALTERNATIVE (B) FINANCING
There are two main reasons why someone would need to consider Alternative (or B) lenders: bruised credit or non-conforming income. The big caveats to using these lenders, is there is a minimum down payment requirement of at least 20%, a lender fee (typically 1%), and higher interest rates.
Whether you've gone through bankruptcy, a consumer proposal, have outstanding collections, or a series of missed payments, the Alternative space is where you'll need to be in order to get financing before your credit gets corrected.
For a lot of self-employed individuals, their main goal is to save as much tax as possible when filing their income. In order to do this, their income will become effectively much lower than it really is, which hinders their ability to get financing through traditional A-lenders. Alternative lenders can, for example, consider bank statements rather than your tax returns to dictate your income level or to support a self-declared income level.
Private financing is an equity-based approach to lending. These lenders focus primarily on the subject property and the loan-to-value when determining risk. Typically, there are no qualification guidelines for credit or income. Depending on the type of property, location, and overall marketability, they will dictate how much they are willing to lend on it. For most lenders, the maximum they will lend is 80% of the value of the property, or as low as 50% if the property is more unique (less marketable). These mortgages can be done in 1st or 2nd charge, and some lenders will lend as much as 90% of the value of the property. Of course, the main caveats are that fees and interest rates are much higher.