Looking for a property to purchase is supposed to be an exciting time.  There is the thrill of looking for properties, viewing online and then seeing them in person.  You will get a buzz of excitement as you walk into the one that you know you want to live in.  The feeling is the same whether you are looking for your first home or your twentieth!

However, the whole process can be ruined at the first step, unless you have a perfect credit record.  This is because you will almost certainly need to locate a mortgage to fund the purchase of your property.  The standard process is to visit a broker, such as Toronto based OE Mortgage; they will go through your current situation with you and advise you of the amount of funds you can expect to borrow.

At this point the excitement starts to build; until the pre-approval is completed and you are turned down.  The real issue here is that you may not even know why you have been turned down!

Fortunately, there is a solution!  You can obtain what is known as a private mortgage instead.

What is a Private Mortgage?

Traditional mortgages are provided by the mainstream lending firms.  They will advance you money based on your credit record, earnings and ability to pay.  In contrast a private mortgage is funds lent by a non-traditional finance institution.  This can include finance houses, investors, venture capitalists and even your family!

Someone who is prepared to offer a private mortgage will be able to assess your case on an individual basis; this provides much greater flexibility.  Although you are much more likely to secure funds from this source, it is important to be aware that the interest rate is generally much higher.

Finding a private Mortgage Lender

In fact, this is much easier than you may think.  You can get your home ownership dreams back on track in virtually no time!  The most likely places to contact a private mortgage lender are:

  • Mortgage Broker

Your first port of call should be your local mortgage broker.  They should be able to put you in touch with private lenders in your area.  The advantage of going through a mortgage broker is that there is a degree of authenticity.  The mortgage broker will not be able to risk their reputation sending you to an un-reputable lender!

  • Family and Friends

The second option is to ask your family and friends.  They may know of someone who will lend privately; they may even be in a position to help you themselves.  If they are you should make sure the terms are clear before you start.  Lending money is one of the biggest reasons for family and friends to fall out.

  • Finance Magazines

There are plenty of finance magazines which have adverts in the back.  It is worth looking at these to see what services are being offered and whether you can find a private mortgage lender or not.

  • Internet

Finally, the internet is the ultimate place to find any service.  One quick look will receive many different people and firms who would be happy to help you out with a private mortgage.  However, you must be careful that you choose a reputable service and you know all the terms and conditions.