Why does it matter whether I apply to a private or government lender for my mortgage? Don’t they all offer the same mortgages? We will answer these important questions in this mortgage guide.
We will explain what private mortgage lenders in Alberta offer that government lenders cannot. Discover why the help of a Leduc mortgage broker might offer a distinct advantage with access to multiple mortgage lenders. This helps to maximize your chance of approval and qualification amounts.
Sluggish Government Bureaucracy
Canadian government lenders are part of a large bureaucracy that churns out tons of paperwork and thrives on red tape. It creates a very, slow cumbersome loan application process that emphasizes rote repetition of routines.
“What is the difference between government and private lenders?”
A good analogy for the difference between the public and private lender is transportation. The government lender might use large trains or buses to move a lot of people. The schedule is very strict, and there is no freedom of choice – One Size Fits All.
Private lenders are like automobiles. Sure, cars are smaller, but you can customize the upholstery, heating and music to your exact specifications. You can drive whenever and wherever, you want – private lenders can find the right financial package, just for you.
Private Mortgage Lenders Respond to Your Needs
Just like your car, your local mortgage broker can respond to your needs. Private lenders can look at your exact situation and find a solution that is not “cookie cutter.” Private lenders are more responsive to the needs of the loan applicants, treating you like humans and not numbers.
Government: Steep Command Structure
The very structures of government lenders and private lenders are different. A government bureaucracy extends through Alberta all the way up to the British Royal family, which still adorns our currency. Each bureaucratic layer adds more red tape.
Sometimes, local government lenders cannot authorize your loans; they only take the application. Government mortgage application approval might take place miles away.
Private: Flat Decision-Making
We offer multiple lenders who compete for your business. We must offer you the best fitting loan package, or you will find one that is better. We must compete for your business.
Private lenders have very flat organization structures. We can meet with you face-to-face and authorize the loan, ourselves. We can offer financial packages that are specifically tailored to fits your needs.
Rejected by the Bank
The bank might have rejected you through no fault of your own. You might have a great income and bad credit. You might be self-employed. So what?
Shouldn’t you have the right to own a home? Those who were rejected by the bank can go to a private lender to find a solution to their problem.
You can’t change who you are
Our mortgage brokers need your business, so we offer you terms and conditions that satisfy your needs. The large government banks might not need your business. They can lend to governments, multinational corporations and celebrities. Large government banks spend most of their time servicing these types of loans.
We have capital; you need capital. You can’t change who you are, and we don’t want you to try. We take you as you are.
More Flexible Terms
Our private lenders can offer more flexible qualification terms than some government lenders. Our multiple private lenders are waiting to provide you with the right financial package to fit your needs. You can review their offers and compare them with one another to fit the right one for you.
Each Alberta mortgage broker has an area of expertise. Here are a few of our advantages:
- Not Required to Follow Government Regulations
- Bad Credit
- No Equifax Score Minimum
- Tax Arrears
- Interest Only
- Various Lengths
- Loan to Value Flexibility
- Self Employed
- Special Properties
We find specific solutions to specific problems.
Not Required to Follow Government Regulations
Of course, we follow all Canadian government laws; but, we are not required to follow government guidelines. A good example was the 2018 mortgage stress test for government-insured mortgages. This only applies to government agencies.
We don’t need to follow government guidelines that are detrimental to our clients, like stricter qualification terms. It is already tough enough getting a mortgage, why make it harder?
No one is perfect. How many Canadians have a perfect Equifax credit score? Government banks might want to lend to them.
We lend to the people who need the money, like you. We have no Equifax score minimum. It is only one number out of many factors determining whether you should get a loan.
We understand that emergencies occur. You still might be very responsible and can make all of your monthly mortgage payments, on time. We give you a second chance.
We can also help those with very little or no credit history. Most banks want two years of documentation history. What if you don’t have that? Some of our private lenders will work with you to find a solution.
Tax Arrears, Bankruptcies & Foreclosures
Some government banks think they are “judge, jury and executioner.” If you owe back taxes, have multiple bankruptcies or are in the midst of a foreclosure, they categorically refuse to lend to you. Some of our mortgage brokers don’t think it is the end of the world.
Sure, private lenders can use these factors as part of the decision-making process, but they are not deal killers. If you weren’t credit challenged, why would you be applying for a mortgage?
Do you want an “Interest Only” mortgage? Peruse our database to find a private lender offering these.
Canada is great because it offers so many variable lengths. Our private lenders go one step further in offering 6-month, 1-year or 2-year terms.
Loan to Value Flexibility
We adhere to all government loan to value laws. We look at loan to value for the property and individual. Some government lenders only look at the individual.
Canada is an immigrant nation. What are we going to do next, send all Americans home? Our mortgage brokers loan to non-residents, immigrants, “New to Canada” and foreigners.
Mortgages for Self Employed
Banks rejected some mortgage applicants for being self-employed. Don’t you find that to be a bit arbitrary?
The Globe and Mail found 2.8 million self-employed Canadians in 2017. Small business owners deserve to be homeowners too. Our lenders can finance mortgages for self-employed.
Some mortgage brokers have years of experience in providing loans for special types of property. We can finance self-builds, construction builds, farm or raw land.
Some banks won’t touch micro-condos, defined as less than 600 square feet. We have lenders who specialize in this financing. We also have brokers who offer commercial loans.
Private lenders might specialize in more exotic financing. Private lenders have “wiggle room” to find the right mortgage for you.
We Like Competition
Have you ever noticed a government that liked competition? No. We offer multiple private mortgage lenders in Alberta because we like competition.
Higher Chance of Approval
If you have multiple lenders to choose from, you have a higher chance of approval. If a hockey player shoots the puck more times, he will score more. You have the freedom to pick and choose from multiple lenders.
Total Qualification Budget
If you find a mortgage broker who accepts a form of alternate income, you can have a higher “Total Qualification Budget.” This means that you can qualify for a larger home.
Local Leduc Mortgage Broker
Leduc is not Toronto. If your financial lender is from Toronto, he will probably have biases based on that environment. He might not understand Leduc culture, economy or history.
How is the local job environment? How does the local weather change how homeowners maintain their properties?
These things are second nature to local Leduc mortgage brokers, but foreign to others. We live here, so we know what to expect. We can view you as a human with real strengths and weaknesses, not a credit score.
For many people rejected by a bank, we are their last hope. We try to find the best financing solution.
The truth is that private lenders are providing more Canadian mortgages because we can offer better fitting mortgages to the public. We can satisfy certain niche mortgages that the government lenders cannot. This is a key advantage of Advantage Mortgage private lenders.
People go to lenders to get financing solutions. And, that is what we offer at Advantage Mortgage. We understand the advantages of a mortgage and help you get the capital, you need. Contact us today for more information on how you can harness the power of multiple mortgage lenders and use it to your advantage.