What is a Private Mortgage?

With the mortgage rules constantly changing, private or alternative mortgages are becoming the only way some people can refinance or buy a home.  When the banks turn borrowers down the next option is to look at “Subprime” lenders.  There is a significant misconception applied to this “subprime” market, so let me explain them a bit.


Getting a 2nd Mortgage in Ontario

In Ontario, a second mortgage on a property title will appear as a separate charge on that property but does not change the first mortgage.  Since there is higher risk to the lender, taking a second mortgage typically has a higher rate of interest.

A second mortgage can allow homeowners to use the equity that they have in their home.  If your first mortgage has high pre-payment charges, or a low rate, a second mortgage can be a better option than a refinance.  This option may also be best for those who are self-employed, have bad credit, or for those in need of fast cash.

What are the Benefits of a 2nd Mortgage?