Buying a home is one of the most significant financial decisions ever. Refinancing your mortgage to consolidate debt and reduce your monthly payments is sometimes necessary, but getting approved for a mortgage can be challenging—especially if you don’t meet traditional lenders’ strict criteria. That’s where private mortgages come in, only available through a mortgage broker with extensive training to offer private mortgages. A mortgage broker is an intermediary between you and the private lender, helping you navigate the complex process and find the best private mortgage solution. They provide a flexible, fast solution for those who may not qualify for a traditional mortgage with their bank, credit union or trust company. Private can be offered as a first mortgage or a second mortgage.

At Sunlite Mortgage, we offer private mortgage solutions designed to meet your unique financial needs. Whether you have credit unacceptable to traditional lenders, are self-employed, or need fast approval, a private mortgage could be the key to securing your dream home. Our process is simple:

• You apply for a private mortgage.
• We assess your financial situation and the equity in your property.
• You can receive your funds in as little as three days if approved.

Key Features of a Private Mortgage

A private mortgage is different from the typical loans offered by banks. These mortgages come from individuals or companies who lend money based on the equity in your property rather than relying solely on your credit score or income. Here are some of the standout features of private mortgages:

• Minimum equity or down payment: To qualify for a private mortgage, you need at least 20% equity in your home if you are refinancing or a 20% down payment if you purchase. The private lender will need an appraisal from an appraiser on the private lender’s approved list.
• Types of Mortgages: Private mortgages are offered as first mortgages, second mortgage and depending on the equity in the property , third mortgages.
• Short-term loans: Private mortgages are usually short-term, ranging from six months to three years.
• Interest-only payments: Many private mortgages offer interest-only payment options, which means your monthly payments will be lower.
• Longer Amortization: Amortization of up to 40 years if you need to make principal payments.
• Faster approval process: With a private lender, you can close your mortgage in as little as three days.
• Flexible approval criteria: While traditional lenders focus on the 5 C’s of credit (character, capacity, capital, collateral, and credit), private lenders are only concerned with the equity in your home.
• No stress test: You won’t need to pass the strict mortgage stress test that banks require, allowing you to qualify for a larger mortgage.

Pros and Cons of Private Mortgages

Before taking out a private mortgage, it’s important to weigh the pros and cons to ensure it fits your financial situation correctly.

Pros:

• Flexible criteria: Private lenders are more likely to approve individuals with credit that is not acceptable to traditional lenders, who are self-employed, or who have irregular income.
• Fast approval process: Unlike traditional banks, which may take weeks to process your application, private lenders can often approve your mortgage within days.
• No stress test: You don’t have to worry about passing the strict mortgage stress test that banks require, which allows you to qualify for a larger mortgage.

Cons:

• Higher interest rates: Private mortgages tend to have higher interest rates than traditional mortgages, often ranging from 4.99% to 15%.
• Fees: Private lenders may charge additional fees, including broker and setup costs.
• Short-term nature: Because private mortgages are short-term, you’ll likely need to refinance or switch to a traditional lender once the term ends.

Who Should Consider a Private Mortgage?

Private mortgages are designed for people who may not qualify for a traditional mortgage but still need financing to purchase or refinance a home. You might want to consider a private mortgage if:

• You have unacceptable credit for traditional lenders, and your lender has declined your mortgage application.
• You’re self-employed with irregular or non-traditional income sources.
• You’re buying an unconventional property that doesn’t meet a bank’s approval standards.
• It would help if you had fast financing and couldn’t wait for the lengthy approval process of a traditional lender.
• You’ve recently moved to Canada and don’t have an established credit history that allows you to qualify under the new-to-Canada mortgage program.

Next Steps: Get Approved Today

If a private mortgage sounds like the right solution for you, don’t wait. At Sunlite Mortgage, we specialize in helping people like you get approved for private mortgages quickly and easily. Our approvals are based on the equity in your home—not your age, income, or credit score. Best of all, we can get you approved in less than 24 hours.

Ready to get started?

Talk to a private mortgage expert today and find the mortgage option that’s perfect for you. Apply online now and get a no-obligation quote!