Are you tired of low returns from GICs and Mutual Funds? Demand more for your money by utilizing Private Lending secured against borrower's real estate. Albertan's need assistance these days more than ever. They are being declined even when they have much built up equity in their homes. We will introduce you to lucrative Alberta lending opportunities and educate you on how to earn a passive income through mortgage investment.
Your loan is registered and secured against Real Estate at land titles as a mortgage through a legal process. It is more than a simple promise to pay you back. It is a loan which can be called in legally if there is default in payments.
Borrowers requiring private funds usually need quick funding and are willing to pay higher rates to remedy their situation. These higher interest rates realized are the return on investment and can be significantly more rewarding than a standard mutual fund or GIC.
You won’t get a phone call every time the toilet plugs up. Mortgage investing is typically more of a hands-off investment. The borrower owns the property and completes all the maintenance and upkeep while you earn interest.
Borrowers require alternative lenders to “bridge” the gap until approvals from a lower interest institutional lender are available. For example, the funds can be used to pay back taxes which prevented the borrower from qualifying at the bank. Both the borrower and your investment portfolio appreciate it.
Lending money is a profitable practice which has been around since the dawn of recorded civilization. Fortunes are amassed with this investment strategy but few know that mortgage lending is not reserved only for banks. Private mortgage loans start at $20,000 and can even be set up through registered funds such as RRSP and TFSA to grow tax free which maximizes the compound interest returns. We can provide education and deliver lucrative secured lending opportunities with no obligation or sign up fees.
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Get in touch and learn how we can bring you quality mortgage investments.
There is no difference between a mortgage and a home equity loan. When thinking about a mortgage, typically "buying a home" comes to mind. This is the mortgage you get to purchase a property and is typically the "first mortgage" registered on title. A home equity loan is often referred to as as a second mortgage (if the original mortgage has not been paid off) which you can get if there is sufficient equity built up in your property.
Typically, $20,000 would be a minimum requested for a private home equity loan.
When you lend money to a borrower, they will pay you back with a set amount of interest. The principal, or original amount of the loan, is your investment. The return on investment is the interest you recieve on the loan. The final return on investment can be calculated when you total the money you recieved back after the loan has been paid out, including any fees such as prepayment privileges.
Borrowers require private funds when they are in situations where the bank will not be able to finance them. Reasons for bank declines include being off work due to injury or market slowdown, having collections on credit file, and having income or property tax arrears. Regardless of the amount of equity in the property, the bank will not be able to lend outside their guidelines. The idea is to fix the immediate problems for the borrower so that they once again can fit within the bank guidelines. Sometimes you may hear of private funds referred to as "bridge financing" as they are meant to bridge the gap until the borrower can once again qualify with traditional institutions. Once the arrears are paid and the borrower is back to work, their credit score will increase and then more options are available to them. That is typically when the borrower will then have the other institution pay out your private loan. Other scenarios include having an investment mature, sale of another property, or inheritance.
Lending can be done through your personal savings, business accounts, or even registered funds such as RRSP and TFSA to grow your portfolio tax free!
No. EquityApproved.ca is the mortgage brokerage which is arranging the loan and you are the direct lender. We never receive any money from you and you are not investing in our brokerage. When making a mortgage investment, you are directly lending your money to another individual with the security of their real estate backing the loan. The loan, handling/dispursment of funds, and registration of mortgage on title is handled in trust through a real estate lawyer. EquityApproved.ca simply sources and arranges the transaction between the parties invovled.
It is free to be a part of the EquityApproved.ca lending network. We only need to understand your lending criteria and we can start notifying you of lending opportunities with matching criteria.
Since the loan is registered as a mortgage on the property at land titles, the lender is entitled to exercise legal rights to enforce the payment of the loan through the foreclosure process. The courts will determine the redemption period which provides the borrower time to bring the loan, including interest, current. Some of the factors courts will use when determining the length of the redemption period are property value / amount of equity left in the property, ability for the borrower to pay back, and market conditions. Generally speaking, if it is determined the lender is in a safe equity position, typically the redemption period will be longer due to the low risk. If there is not much equity available in the property, the redeption period would be shorter. The lender will pay for legal costs during foreclosure proceedings up front (approximately $2k - $3k), but these costs would be recouped at loan maturity or out of the proceeds from sale of the home if there is sufficient equity.