There are many types of private mortgage toronto lenders and each one focuses on a special slice of the market.
Loans that are Seller-financed
The seller of the property provides financing to a buyer. This type of arrangement is highly risky. Most sellers profit from borrowers twice: first, from the outright sale of the property, and second, from the interest of the borrowed money.
Lending done via Savings and Loans
These mortgage lenders use the savings of private investors to provide mortgages. They are one of the largest mortgage providers in the country.
Certain Mortgage Bankers
Here’s a rule of thumb in dealing with mortgage bankers: the bigger the bank, the better the rates they can offer. When dealing with mortgage bankers, you must be cognizant of the fact that they will control the loan throughout the whole process, from underwriting to servicing and even to the selling on the secondary market.
Toronto Mortgage Brokers
Brokers are the ones who sell loans for lenders, such as mortgage bankers. In the loan distribution network, they are at the storefront. It is possible to find a good mortgage broker through friends, co-workers, and online searches.
These are owned by members and it is precisely for this reason that they give good rates and services. They operate in a similar manner as mortgage bankers.
Below are important things to note when shopping for mortgage lenders.
Finding Private Mortgage Lenders
It’s easy to locate private mortgage lenders. If you know a real estate agent, ask this person to recommend a lender to you. If you know someone who purchased a home very recently, ask him or her for a referral. Finally, if you have a telephone and a phone directory, then turn to the yellow pages. Couple this with looking out for advertisements in print and broadcast media.
It is the Department of Commerce that issues licenses to mortgage lenders.
Reducing the Names of Your List
To weed out the names on your list, call the Department of Commerce or check their website. Go to the portion marked Consumer Info & Services and click on Enforcement Actions. You will then find a listing of any action taken against mortgage lenders.
The Department of Commerce updates its list of mortgage lenders with complaints and violations. It has the authority to publicly reprimand a mortgage lender for failing to follow rules. Should another incident requiring government intervention occur, the department may choose to revoke or suspend the mortgage originators.
Finding the Best Rates
Comparative mortgage charts are printed in local newspapers’ real estate sections. This is a good place to look for a mortgage lender.
Take your time to shop around for mortgage lenders. Finding a mortgage lender is as crucial as finding a home itself. After all, borrowers’ relationships with mortgage lenders range between 15 to 30 years. For the relationship to last that long, it must be a match made in heaven.