What is a Private Mortgage?

Private mortgages are a special and very interesting type of mortgage option that most people are not too familiar with. The most basic definition is a mortgage contract in which the lender is not a registered financial institution but may be a friend, family member or individual investor.

Because banks and other financial institutions have strict guidelines for lending that limit their ability to finance certain scenarios and borrower profiles, private mortgages are used to meet those unique needs. Some typical situations where a borrower may need private financing include:

- Financing for a cottage or unique property

- Financing for renovation projects and construction

- Financing for an individual who can't prove their income by conventional means

- Financing to consolidate debt or recover from a bankruptcy

- Financing for individuals who have income tax or property tax arrears

There are several benefits to the borrower and investor alike in this type of mortgage arrangement.

From the borrowers point of view, private mortgages can be an excellent alternative when a suitable bank mortgage is impossible to obtain. Reasons why a borrower may require a private mortgage include; need for a second mortgage, poor credit, income tax arrears, tax arrears, construction financing, financing on properties that institutional banks may not consider prime, cases where an individual has recently gone bankrupt or just can't prove their income. A private mortgage should never be a long term strategy for a borrower, as the interest rates tend to be higher and do not always have the features and flexibility that institutional mortgages offer.

Anybody can lend money through a mortgage. You don't have to be a bank to lend money, it is possible for anyone to offer a private mortgage so long as it is arranged through a licensed mortgage broker in Ontario. Private mortgages are a great investment vehicle which provides monthly income. In addition, mortgages are negotiable instruments which can be assumed, renegotiated, and transferred as needed. All the while the investor is protected by the security of the real estate on which the mortgage is registered.

Regardless of whether you are a borrower or an investor a knowledgeable mortgage broker who is specialized in private mortgages is necessary in order to arrange the mortgage and also provide the guidance needed to make informed decisions.

Christopher Molder is a Toronto Mortgage Broker who is continuing in the footsteps of his father Arnold Molder, a mortgage broker with over 4 decades of experience. His blog http://sonofabroker.com is a source of entertaining, enlightening and educational mortgage information for all Canadian homeowners. To learn more about Christopher and his unique perspective on mortgages visit his blog http://sonofabroker.com

Article Source: http://EzineArticles.com/expert/Christopher_Molder/521401

Facts and Tips about New Construction Home Loans

New construction home loans are not the same as your typical, everyday home loans. They tend to have different requirements and adhere to different rules. If you wish to know more about new home construction loans, read on. You just might find an easier way to own your dream home.

The Definition of New Construction Home Loans

When you ask for this type of loan, you're asking the mortgage provider to give you the money you need to build your own home.

The Basis of Approval

First and foremost, your mortgage provider would require a detailed explanation as well as accounting on the estimated costs for your home-building project. They'd want to know how much experience you have in the field of construction, how much you estimate you're going to spend on your house and how it's going to look in the end.

Only after you've passed the initial screening, they ask you to submit the usual documents that would enlighten them about your earning capabilities and credit reputation.

The Types of Construction Loans

There are different types of construction loans.

A construction to permanent loan is a two-in-one loan ideal for most people since it would only require you to submit documents and pay closing costs once. This type of loan is a combination of a construction loan and permanent financing. Rather than applying for a construction loan initially, then following it up with a typical home loan, an approved CTP loan can help you save money and time.

A remodeler loan is a second mortgage that's designed to provide financing for a home improvement or remodeling project.

A bridge loan allows you to use the equity on your present home as down payment for your new home.

Lastly, a lot/land loan gives you the resources to buy land instead of building a home.

Home Loans [http://www.WetPluto.com/A-Guide-To-Home-Equity-Loan-Rates.html] provides detailed information on Home Loans, Home Equity Loans, Home Improvement Loans, Home Equity Loan Rates and more. Home Loans is affiliated with Home Improvement Loans Info [http://www.i-homeimprovementloans.com].

Article Source: http://EzineArticles.com/expert/Kent_Pinkerton/44498

Mortgage Reducing Term Assurance (MRTA)

How much should I pay for insurance?

That's exactly how much you need to find out - The MRTA calculator gives you the figure you need to calculate your mortgage reducing term assurance or MRTA. First, the definition of MRTA.

MRTA is defined as Mortgage Reducing Term Assurance; reducing term life assurance specially designed to protect a loan borrower against death or TPD (total permanent disability) due to natural or accidental causes.

>> Firstly, check your MRTA Premium and how much you should pay for your insurance.

MRTA is very often a lump sum and the lending institution will arrange fire and Mortgage Reducing Term Assurance of insurance cover. Should anything happen to you during the period of the loan requested/applied, the Insurance Company which issued the policy will pay the outstanding balance of the repayment to the bank/finance institution.

How will MRTA benefit you? 

1. Premium financing Pay a small sum to accumulate over with the plan. It's affordable and reliable.
2. Single premium payment Full protection for a one-time fee. For life.
3. Liberal TPD explanatory If you cannot perform your regular work for six (6) consecutive months, TPD benefits will be feasible. Some packages offer only permanent disability.
4. Guaranteed acceptance Acceptance is guaranteed for loan borrowings up to RM150,000 and entry ages up to 50 years next birthday. Subject to other terms and conditions.
5. 24 hours worldwide coverage Anywhere in the world you're covered, not only in the respective country you apply.
6. Guaranteed benefit to settle your balance mortgage The repayment of your housing loan will be settle should there be any causes of death of TPD.

>> Get the MRTA Calculator here [http://www.fiscal-wise.com.my/FiscalWiseWeb/FinancialTool/MRTA.aspx].

Written by John of Fiscal

http://malaysiahomeloan.blogspot.com/

Article Source: http://EzineArticles.com/expert/John_Li/222723