As Fraser Valley Mortgages Brokers, we’ve decided to give you all an easy read on everything you need to know about B-lenders & Private Mortgages.
Most of us are vaguely aware of private mortgages, although B Lender Mortgages & Private Mortgages are the fastest-growing segments in the Canadian mortgage industry because they’re much easier to qualify for than the A-side.
The A-side is getting tougher to qualify for now than at any time in recent memory. High prices in major cities, large mortgage requirements, and a higher stress test, which can put qualifications out of reach for homeowners who have had no concerns. This is where B-Lenders or Private Mortgages are needed to step in and help the homeowner get on track.
B Lenders are necessary, but all are very similar, watch out for lenders that add on High Fees.
4 most common cases when B lenders are needed to step in
Consolidations – doing a debt consolidation lifts the burden of debt but also helps lift your credit score, which will get you back to the best rates on the markets.
Stated Income – There are cutbacks on self-employed lending for those who do not “claim” enough income. If you’re a self-employed individual, the more you write off the less of a mortgage you will qualify for. Give short-term capital while figuring out income.
Construction Financing – Banks have tightened up on construction financing leaving fewer options.
CRA Debt– Most Banks will not let you use a mortgage to pay off CRA debt. If you have CRA Debt, you must pay that off before applying for your mortgage.