Second Mortgages

March 20, 2008

What are second mortgages?

Second mortgages are loan contracts secured on real properties which already have prior first mortgage charges on them. Most second mortgages are private mortgage loans provided by private mortgage lenders. These private mortgage loans fill the gaps that some financial institution such as banks and credit unions are unable or unwilling to fulfill.

Private Mortgage Lenders

Second mortgages are secured high yield investments private investors understand, and at the same time have some control on the investments. A private mortgage is a relatively safe investment. Most private lenders capped their investment risks to not more than 85% of the real estates provided as securities. The interest rates payable on 2nd mortgage loan contracts are from 9% to 18% per annum.

Some common features of a 2nd mortgage are:

1). Financing up to 80%/90% of house value.
2). Interest rates from 9% to 18%.
3). Term – generally from 1 to 3 years.
4). Payments – mostly interest payment only.
5). Lender/broker fees – varies from 4% to 8%
6). Lending area – Vancouver and Fraser Valley.
7). Approval time – may take 1 day to 5 days.
8). Loan funding – can be done in less then 10 days.

Hard Money Financing

The use of hard money financing is a last resort and urgent financing that helps to save the a borrower’s home from being foreclosed. Not many home owners are aware of this type of financing to avoid foreclosure. The cost of losing a home due to foreclosure is much higher than the cost of getting “hard money financing”. We have private lenders who may provide the financing to save a home from foreclosure.

If you like to have more information on private mortgages or hard money financing, call me now at 604-721-4817 for a discussion.

Kindly contact me (Elsie Tse) at 604-716-3369 or Email Me 

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Buying With 5% Down Payment

March 2, 2008

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Buying a home with 5% down payment. This is the minimum requirement for a home buyer to qualify for a high ratio mortgage. A home buyer is also required to show he or she has her own savings to cover closing costs of at least 1.5% of the purchase price. Read more