Tagged : private lending

Mortgage rates weren’t supposed to make record lows in 2015, not if you asked economists and the Bank of Canada two years ago. But they did. And despite all the chatter about the first U.S. rate hike since 2006, Canadian rates could do it again in 2016.

But interest rates won’t be all that’s changing in the coming 12 months. Here are four mortgage trends you need to watch in 2016.

More missed payments?

Seemingly every year the government throws new rules at the mortgage market, lending gets tighter and the housing market gets safer. But one thing Ottawa can’t control is world economics. Despite manufacturing gains from a cheap loonie, global growth is slowing. That and plunging oil means more Canadians could be out of work, and when people lose

With a credit score under 600, it is likely that you will be turned down by a bad credit or prime lender and you may have to turn to a private lender. Private lenders provide an option to clients with bruised credit. Since it is a fast financing option with a higher risk to the lender, interest rates are almost always higher.

Most borrowers – real estate investors included – think of private lenders as a last-resort option if they can’t secure financing anywhere else. But private funds are gaining traction as a financing option due to the new mortgage rules set by the federal government and the continued post-crisis caution being exercised by institutional lenders. Private lenders have realized that conservative lending guidelines used by banks and