Client came to Jeff Di Lorenzo of The Mortgage Group Vancouver with a home under foreclosure located in Central BC. This client had many judgments on title plus property taxes outstanding. Client also owned a parcel of land that was previously listed for sale. It turned out that the parcel of land also had property taxes owing for over three years and the crown seized the property without the clients realizing.
We were able to stop the foreclosure, reinstated clients 1st mortgage obtain a 2nd mortgage to payout all arrears and debts as well as apply to get the forfeited lot back into the clients name. We provided additional funds to help assist the client to obtain new employment. Client had suffered a significant personal loss as well as an employment loss.
We are pleased to have been able to assist our client with a fresh start.
Self Employed Equity Mortgage BC | Equity Mortgage Programs
Self employed and have trouble providing enough income to qualify under your banks strict guidelines? You seen self employed mortgage videos and read many financial articles on it, but for many BFS income earners providing proof of income can significantly affect their business due to the amount you will be required to pay in personal income tax. Most banks have products that allow you to state income but the income stated must be groused up 15% from your income claimed. For many business owners this just does not provide enough income.
1st & 2nd Home Equity Mortgages BC |Bank Rates up to 65% of Homes Value
I have sourced some unique products for my self employed clients. These products work for many of my clients due to the ease of qualifying documents. If you are self employed and have been for two years or more, owe no personal income tax live in Metro Vancouver you can qualify. You do require to pay for an appraisal to confirm lending value but the process is very basic.
Details & Documents for BC Home Equity Mortgage Self Employed
The Requirements are:
Purchase or Refinancing
Terms 1-5 ye 7 & 10years, 5 year variable rate
Amortization 30 years
No min Beacon Score (must be explainable credit no r2 reporting in the last 2 years)
No past Bankruptcy
No income required (lender must be satisfied with clients ability to make monthly payments)
Self Employed Income Proof: Min 2 years BFS evidence: Articles of Incorporation, Business License min 2 years, Accountant Prepared Financial Statements, T1 General with Statement of Business Activities, two year business bank account statements
Property Types: SFD, Townhouse & Condo (marketable good salable condition)
1st & 2nd Mortgage (2nd mortgage will only be granted to CMHC approved lending institutions)
Call Your BC Mortgage Broker To Help You Navigate Your Financial Future.
Insiders Info On Private Mortgage Lenders. CALL US!
Private mortgage lenders fill the gap when banks and home owners needs do not match. In life there are ups and downs but for bank profits they only want to look at the ups. This is where private mortgage lenders come into play. They will consider financing solely based on your homes equity not income or credit.
How Do I Negotiate The Best Private Mortgage Lenders Rate?
Negotiating the best rate from a private mortgage lender is harder than it looks. This is manly due to the different between rate & cost of arranging the mortgage financing. There are some very good private mortgage lenders out there that have straight forward mortgage documents and very competitive rates. There are also lenders that provide lower than average rates in hopes that less sophisticated borrowers look only at the rate and payment structure of the financing and not the cost to arrange the financing.
How Do I Know If I Am Getting A Good Private Mortgage Loan?
A good private mortgage loan is part rate, part cost & part terms. To fully understand the benefits of private mortgages is determining your use. You must be realistic about your situation, are you in a position that will be fixed in one years time or is this something that may take a few years? In most cases an outside expert like a mortgage broker is your best advocate to determine if you are being realistic about your situation and your time frame.
Who To Call To Obtain A Quote From A Private Mortgage Lender?
A Mortgage Broker who is not associated with the lender is a good start. Not all mortgage brokers have a ton of experience in Private Mortgage Lending due to this type of lending makes up about 5% of the mortgage application. I am a very experienced Mortgage Broker with many of different private mortgage lenders that I frequently work with. I am able to quickly attain which lender has the best product and/or what lender may be sitting on a lot of money. When private mortgage lenders are flush with available funds they are usually willing to provide more options or lower costs to get their money out working for them. There are many lenders out their that are more familiar to the public due to the amount of advertising they offer but in most cases they are not a great fit in terms of product.
Jeff DiLorenzo The Mortgage Group Canada Inc
Call for no obligation over the phone estimation 1-877-744-3436
Will A Consumer Proposal Affect My Mortgage At Renewal?
Unique financial situations come into play for many people and choosing a consumer proposal is something that some Canadians turn to when debts and other bills put them at risk of loosing their home. I have personally witnessed clients that have had great success going through these debt consolidation programs. But there are things to be aware of and debt owed to the same institution that holds your mortgage is something you should take great consideration prior to including this into your restructuring.
I know how difficult it is as a mortgage broker to try to think of all aspects of a transaction, current and in the future and the affects it may have on my clients. The same thing I am sure that credit counselors consider when structuring a consumer proposal.
One thing I see often is client calling me up one or two years after they have entered into a consumer proposal. Sometimes they ask, “How will the consumer proposal affect my chances of the bank renewing my mortgage?” Other times they are in a panic and tell me “My bank will not renew my mortgage due to my consumer proposal.”
I am sure there are many things to considered by a consumer proposal counselor when doing up a consumer proposal like, reducing as much debt for the client, getting the best payment structure for the client to maintain a successful repayment program. The one thing I see as a mortgage broker dealing with renewals or refinancing a mortgage for clients that have went into a consumer proposal is the debts owed to the same bank that holds your mortgage payment may cause issues at the time of renewal.
It can be more costly to have to refinance your existing mortgage if your bank will not renew your mortgage due to you walking away from a small credit card or unsecured LOC. Prior to including these debts, I would have a long talk with the branch that holds that debt to get some assurance that it will not affect the mortgage renewal.
I have seen clients go through with the proposal only to have the bank not renew 3 years later and they end up having no options available to refinance and are forced to sell. If you considered a consumer proposal as a way to save your home make sure you keep your current mortgage lender happy and discuss in length what debt you should or should not include.
I am available to speak to you and provide options from 9am to 9pm 7 days a week.
I have helped many individuals that for one reason or another are years behind in their personal income tax. When your bank will not assist you due to tax arrears I have lenders that will lend sole on the equity in your home. Call today if you require assistance.
Mortgage Rate Shopper or Work with a Mortgage Professional?
Rate Shopper “What is the lowest home equity loan rate you have” is a question I get every day. As rate shopper looking for a BC Home Equity Loans (this does not apply to Home Equity LOC’s to 65% LTV at a bank or financial institution) you are dealing with a product that means for one reason or another you do not qualify under conventional mortgage criteria. Although rate should play a part in every transaction your Mortgage Brokers knowledge in lenders & negotiating terms and conditions is going to be the major factor in determining costs associated with arranging the financing now and possible costs in the future.
Let’s look at a few scenarios, why you do not qualify for conventional financing and why you should use a mortgage expert rather than becoming a rate shopper and get a better understanding of your needs and the difference between Home Equity Loan rates & lenders:
You are self employed and do not want to claim all your income due to the cost savings in taxes. This is true in some cases but if you are stuck with a very low max mortgage (lets say $150,000) and you have to top this up with a larger home equity loan (lets say $150,000) at a higher rate of interest this might be a good time to start paying the government and stop paying the high rate home equity loan. An experienced mortgage professional can help you run the numbers and make an informed decision. A direct lender may not work with you to better your current situation because they do not provide conventional financing options to their clients. It is not about rate it’s about dealing with a true professional mortgage broker independent from the lenders that can show you the cost associated with the mortgage rather than being just a rate shopper.
You have bad credit and you are looking to borrow money to payoff debts. That is great!! But do you know some of the pitfalls or techniques to do it correctly? Credit can recover quickly if you do it right, for example sometimes it is best to pay off and entire card and other times it is good to just pay the balance down under 50% of the limit. Paying off cards or other loans and closing accounts can have devastating impact on your credit. Trade lines tell a story about your payment history over time, like it or not. But bad credit is sometimes a moment in time and not a reflection on you over a long period of time. Deleting that history can have a larger impact than the missed payments. For many DIY client rate shopping for home equity loan does not take into account the costs they incurred when not taking a look at the whole picture.
How much is too much to borrow? Great you were approved for $100,000 2nd mortgage to pay off credit card debts pay your property taxes and do some home renovations. Will you be able to refinance your 1st mortgage to include this $100,000 in the future? Credit and debt servicing ratios (TDS & GDS Ratio) play a massive roll in your future financing options. Borrowing too much now can affect your future refinance, but equity lenders only look at equity to qualify your approval. There is more to consider and a mortgage professional can provide options for you to consider.
Is the interest rate you have affected by a lender fee? Lender fees may affect your financing at the end of the term. Many lenders use a lender fee as well as a broker fee when providing an offer sheet. While the practice is not bad in all cases, in some it can be a surprise if that lender fee was to offset your rate to appear lower. For example a $100,000 home equity loan at 6% with a $2,000 lender fee is 2 % higher than a rate without a lender fee. At the end of the term what if the lender wants to yield 8% on the loan again? That means a lender fee of 2% is required to renew that mortgage. A $2,000 cost to the borrower at renewal can be a shock and may not be manageable leaving you to refinance your mortgage again to pay for those costs. In those cases focusing on rate doesn’t prepare you for the true cost of borrowing money.
You have bad credit and you always have had bad credit, that’s just the way you are. Ya there are people like this and there are bad credit mortgage lenders that are better to use for late payers than others lenders. The management of a home equity loan is un-measurable costs and many private lenders that offer great home equity loan rates do not want to see late payment, held payments or any other sort of management of the mortgage. These lenders may not a renewal at the end of the term to people with payment issues. So understanding a client’s history by a complete review of their credit history and setting the client up with a lender at a rate they are comfortable managing payment delinquencies at can be a significant cost saving to you the borrower. You might think “why pay for a higher rate if I don’t have to for a home equity loan”. Well being matched with the right lender at the right interest rate can be far less expensive than the cost of refinancing your mortgage every year if the lender does not want to deal with payment issues. Be honest with yourself if you lose track of payment dates constantly you need someone that understands you, and there is a cost associated with that.
Don’t try to be a DIY Mortgage Professional When dealing with Home Equity Loans. Leave it to independent mortgage experts!
Title Insurance What Is It & Why So Many Private Lenders Require It.
British Columbia works on the modified Torrens land title system that “guarantees” your title. It is questionably one of the best systems for land registration. This system is very accurate in determining who the owner is and what registered charges are against the property. The province assurance fund also pays financial compensation in appropriate cases where the possibility of lose of title through fraud occurs.
This system has been in place for many years and is considered great for normal transactions.
What Is Title Insurance & Why You Might Consider Getting It.
Title Insurance insures buyers or lenders against potential loss of title (for example, ownership of the property you’re buying) &/or problems with the title. Almost all private mortgage lenders require title insurance on all mortgages they do.
Example of a Problem with Title: Client purchases a home with a shared driveway. The home in question has no other access to the road system without using this driveway. Later the home owner finds out that the driveway has no right of way or easement for the title of his/her home and the other home owner will not grant this to them. This is a case where title insurance can cover the lender & possible the home purchaser.
As well title insurance might cover you for construction done by the previous home owner without permits or building by-law infractions, land use as well as set back problems.
Very few mortgage fraud cases happen in BC in the past two decades but they do get quite a bit of media attention when they do. If an innocent home owner is defrauded through transfer of their title and the fraudster who then takes out a mortgage and takes off with the money, then the lender now bears the risk of loss. This makes the small cost of Title Insurance worth it for you in BC.
If you are considering the purchase or refinance of a home consider title insurance or talk to a Real Estate lawyer to better understand the benefit or other useful product for your particular transaction.
Equity Mortgages BC & Foreign Investors from China Greece & Russia
The foreign real estate investing is not a new concept in the Canadian real estate market. For many years now China has been one of the leaders in the Vancouver Real Estate market but there are two emerging competitors due to the financial uncertainty in Russia & Greece. Article MortgageBrokerNews.ca
With the banks stricter mortgage rules where will this leave foreign &/or non resident real estate investors if they can’t provide adequate assets or down payment to satisfy banking guidelines?
Non Resident Equity Mortgage Solutions
Some Banks require 35% and in some cases 50% as a down payment under their policies. Non Resident can get approved by using a Non Resident Equity Mortgage solutions:
B-Lenders can be an option; they can allow greater loan to value ratios. In most cases up to 75% LTV. Rates are slightly higher than bank rates and usually these types of mortgages come with a 1% to 2% fee associated with the setup.
Home Equity Mortgage Lenders lend base most of their lending criteria on equity. In most cases proof of income & credit is not an issue and generally lend up to 75% LTV. These mortgages come with higher costs and rate but can close in most cases faster than banks & b-lender.
2nd Mortgage Options would be another option. Firstly we would obtain a conventional lender (bank, trust company or credit union) to take on the 1st mortgage to the maximum the client would qualify. We then match the foreign real estate investor with a 2nd mortgage generally up to 75% LTV for the balance. Broker & Lender fees may apply in addition to higher rates due to the priority of the mortgage. There are 2nd mortgage programs able to lend up to 85% LTV but the costs associated with these types of loans are Very costly.
For a no obligation review of your mortgage needs feel free to give me a call to discuss equity mortgage options that might be right for you.
Improve Bad Credit & Stop the Cycle of Applying For Private Mortgages
How to you stop the cycle of bad credit mortgages? When refinancing a mortgage or taking out home equity with bad credit you have very few options. I have many private mortgage lenders that are happy to offer financing at an increased rate of interest if you are suffering from bad credit.
How to Improve Your Credit Score & Stop High Interest Mortgage Loans
Credit scores are a funny thing and how to improve your credit score can depend on a variety of factors:
Credit inquiries, people that apply for credit multiple times a year impact their credit in a negative way.
Trade Lines above 50% of the limit. Credit is intended for a short period loan not a monthly budgeting plan. Keeping balances at 50% of the limit negatively impacts your credit score.
Missed or late payments. Keeping at lease the min monthly payment current will go along ways to maintaining good credit history.
Collections R5 to R9 payment history. Taking care of past collections or letting old collections fall of credit reports can be a slippery slop. It is best to discuss what to do with a mortgage professional or debt consolidation agent.
Paying off Credit Cards in Collections May Improve Your Chances of Conventional Mortgages?
If you have a private mortgage with accounts in collection on your credit bureau you have to determine if you are going to pay these collections out or if they will be falling off your credit bureau in a manageable time. Strategies should be discussed with a mortgage broker or financial advisor because without improving your credit score traditional financing will be a difficult process to qualify for.
Credit Reports, What Are They?
A credit report is a record about an individual that includes:
Name, Address, Employment etc: Information about the persons Identity
Creditors, Limits and Balances owed payment history.
Information regarding past or present bankruptcies, court judgments, debts assigned to collection agencies & repossessions.
Credit enquirers like how many times client apply to have their credit researched.
Credit Reports, How To Access Yours?
You can access a free copy of your credit report online that requires two pieces of ID.
In BC, you can send your request to either or both of the two companies operating in the province. They are Equifax Canada and TransUnion.
Paying down debt Top Financial Concern for Canadians in 2015
In a CIBC pole Canadians were asked, what is the top financial priority for 2015. This year like the past four years it is to pay down consumer debt. The focus for most mortgage brokers is educating clients on how to pay down or consolidate debts.
Steps To Consolidate Canadians Debts
Where to start, is most Canadians biggest challenges when starting to look at how to Consolidate Debts.
Collect Your Personal Information: Make a list of current debts but wean out the debts that might not qualify for debt consolidation.
Check Credit Score: Applying to Equifax Canada will give you an idea how good or poor your credit score is.
Look into Loan Options: There are several avenues to look at when dealing with debt consolidation. If it is unsecured financing you are looking for check with a few banks. If you are looking for a home equity loan to consolidate debts check with a mortgage broker who specializes in equity take out financing. Equity Loans are not all the same and it is important to have a professional research between banks & alternative lenders to find the best product for your needs.
Get Rid Impulse Purchasing: Take credit cards out of your wallet or any other credit or overdraft that could tempt you in making foolish purchases. Remember a consolidation loan isn’t there so you are able to manage a payment and spend more. It is there to lower your payment so you can attack your debt more effectively.
If we can be of any assistance to you in your search to reduce your debt give us a call we would be happy to give you a no obligation assessment of your situation.