In recent years the financial crisis, and the demise of the sub-prime mortgage industry left many small businesses unable to access funds. These businesses sought funding from private lenders, who were willing to take on the riskier clients for the benefit of higher interest rates.

Private Equity Mortgage Lenders Enter the Market

The result is that the private lending industry is growing. More and more private debt funders are responding to the burgeoning need for investment funding. Recently private equity firms have also responded to the call for funds with many of them entering the debt financing business. The higher interest rates charged in the debt finance industry make for attractive profits even when adjusting for risk.
The entry of private equity companies into the industry is great news for investors, as they are able to raise the large amounts of capital required for larger real estate investments.

Private Funds

Because of the higher interest rates borrowers usually turn to private lenders only once they have been turned down by conventional banks. The loans are short term typically over periods of one to five years. The funds are usually required to consolidate debt, purchase additional properties or fix up existing assets. Borrowers should always enter the relationship with an end game in mind as the private funds will have to be replaced with a cheaper, conventional mortgage by the end of the contract.
Although private funding is considerably more expensive than conventional real estate funding, there is certainly good news for borrowers. The end of the sub-prime era has increased the demand for private funds. This has in turn resulted in reductions in the required interest rates. For the real estate investor that buys to rent interest payments are tax deductible and this can help to off-set the cost of the higher interest.

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Featured Rates

FIXED

LenderRateTerm
Mortgage Lendwise RateLendwise

3.40%

5-Year
Mortgage First National Bank RateFirst National Financial

3.59%

4-Year
Mortgage RMG RateRMG Mortgages

3.29%

3-Year
Mortgage Street Capital RateStreet Capital Bank

3.19%

2-Year
Mortgage TD Bank RateTD Bank

3.19%

1-Year

VARIABLE

TermRate
5-Year Variable

2.75%

3-Year Variable

3.35%

OTHER

TypeRate
Line of CreditStarting at

3.00%

Equity LoansStarting at

5.99%

Private MortgagesStarting at

5.99%

Benefits of Private Equity Mortgage Lenders

  • Property developers who already have several properties may find it difficult to obtain additional funding from a conventional bank, but private lenders can and often do make funds available for investors to buy to renovate and flip or they make second mortgages available for the down payment on a promising property.
  • Conventional banks are governed by strict regulatory requirements whereas private lenders are not subject to these regulations. This means that the borrower saves the time and effort required to fill out reams of bureaucratic paperwork.
  • Whereas the private lender is really only interested in the value of the property being purchased, the bank will require information on rental, lease agreements, credit history and a property appraisal.
  • The reduction of red tape means that the time between application and approval is foreshortened and private real estate investors are able to make a quick deal.

Finding a Private Lender

The best way to find a private lender is to approach a property broker who typically would have a number of lenders on his books. Private lenders do like to deal with brokers who assist in the evaluation of applicants and ensure that the right match is made. The broker also ensures the borrower approaches the lender with all the information required to secure the funds. In the private lending industry there is no one size fits all, each of the lenders deals in a specialised field. A broker can help to match the borrower with the best private lender.

OUR CUSTOMERS LOVE US

My wife and I recently purchased our first place, so we started to look for a mortgage broker. Neither of us really knew what we were doing, so it was important to us that we could find someone who could guide us through the whole process. After some searching we finally stumbled upon the guys at certified mortgage broker We worked with leon and his team, got a great rate and they took their time to explain and guide us through the whole process. Great rates and great service. Would absolutely recommend.
Linderman Beadles
Linderman Beadles
06:16 26 Feb 18
Got tired of sow service and mediocre rates from my bank, so I started looking for a mortgage broker. Had some family friends recommended Leon and his team, so decided to check them out. Was very impressed with Leon, he guided me through step by step, recommended a mortgage and I ended up switching to him. My rate is better and he always answers call and emails right away.
Gina Carroll
Gina Carroll
05:06 28 Feb 18
Was looking for a new mortgage broker, my old one moved so had to find someone else to work with. Didn't really know how to go about it so just started googling. After some searching and talking, decided to go with the guys at certified mortgage broker. No one could match their rates, plus their customer service is honestly some of the best i’ve seen.
Deane Laflamme
Deane Laflamme
04:40 27 Feb 18
My wife and I recently purchased our first place, so we started to look for a mortgage broker. Neither of us really knew what we were doing, so it was important to us that we could find someone who could guide us through the whole process. After some searching we finally stumbled upon the guys at certified mortgage broker We worked with leon and his team, got a great rate and they took their time to explain and guide us through the whole process. Great rates and great service. Would absolutely recommend.
Stephnie Boyles
Stephnie Boyles
13:59 15 Nov 17
Got tired of sow service and mediocre rates from my bank, so I started looking for a mortgage broker. Had some family friends recommended Leon and his team, so decided to check them out. Was very impressed with Leon, he guided me through step by step, recommended a mortgage and I ended up switching to him. My rate is better and he always answers call and emails right away.
Billye Peralta
Billye Peralta
13:38 19 Nov 17
Was looking for a new mortgage broker, my old one moved so had to find someone else to work with. Didn't really know how to go about it so just started googling. After some searching and talking, decided to go with the guys at certified mortgage broker. No one could match their rates, plus their customer service is honestly some of the best i’ve seen.
Moore Hoover
Moore Hoover
02:25 16 Nov 17
We worked with Leon and he provided a thorough and a professional process in re-financing our mortgage. Communication was consistent, he was easy to reach and documents were processed quickly. Most importantly, we got a great rate that has us savings hundreds of dollars per month on our home. These guys really know what they're doing.
Melissa Brown
Melissa Brown
00:12 18 Jul 17
As third time home buyers we couldn't be happier with the service we got from Certified mortgage broker. The team did a great job working on our loan. Everything was fast, easy and transparent. Probably the best mortgage experience i’ve ever had.
Riley Clements
Riley Clements
15:27 20 Jul 17

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