Private Mortgage Loans
Contact
Steven Acworth
Private Mortgages
Mobile +61 488 224416
What are private mortgages?
- Mortgage loans obtained from private parties or companies instead of going to the main banks, credit unions or big bank lenders. There is a direct relationship between borrower and lender.
- Quick decisions are available provided information provided by the applicant is reliable and stands up to the test of scrutiny.
- In the case of Little Rock you will talk directly to the private lender’s nominated mortgage manager and flexible, rational decisions can be made quickly instead time consumed via a highly departmentalised institution. Sensible flexibility is available.
When should someone use private mortgages?
Basically when the banks can’t help you and you need mortgage funding. Banks might have rejected you back or you may already know what their answer would be if you applied. It may be that
- You need the funding too quickly for institutional performance
- Formal valuations may not be required
- You are temporarily outside bank criteria but that will change in the short to medium term
- You need the funding only for a short period with an exit strategy by sale or transition institutional compliance
- Strong asset and capacity, but you have impaired credit
Who provides private mortgage finance?
High net worth individuals or small corporations, as part of a balanced investment portfolio. These lenders have to comply with the same finance laws as the banks however can be a little more flexible and can think out of the box. There is less red tape. Often, private, alternative mortgage loans are provided by people currently operating in business themselves.
MOST IMPORTANTLY, DO ALL PARTIES POTENTIALLY BENEFIT?
PRIVATE LENDERS AUSTRALIA, PRIVATE INVESTORS, PRIVATE FUNDING, PRIVATE MORTGAGE LOANS, BORROWERS OF PRIVATE MONEY
How do you qualify for private mortgages and what do they cost?
Typically, the main requirements are the following:
- Equity in your real estate asset
- Location, nature of the asset and proposed gearing (loan to valuation ratio)
- You need to have a plan! You have to tell the lender how you intend to pay back the loan. This is commonly referred to as your “exit strategy”
- Loan terms are short term, typically six to twelve months
- If you see private mortgage lending as a long term debt strategy, then you have not understood its purpose. It would then be unlikely that the private loan would be made availabl in the first place
Loans are structured to your specific needs. Because of this, the short term nature and put bluntly, often the lack of realistic alternative they are short term they are more expensive than banks or credit unions. Similarly, the greater the loan amount, generally the higher the cost. Why? Simply, supply and demand. The more money you need, the fewer people in a position to provide it as part of a balanced portfolio
So, six (6) reasons to seek a private mortgage solution -
- “Time crunch”. They are fast where you provide reliable, transparent and logical material and information
- Direct relationship
- Less hassle
- Short term solution, giving time to “transition” to bank guidelines
- Substantially asset based (within the boundaries of responsible lending), with credit impairment taken into account and not discarded out of hand
- Flexible and structured specifically, with modifications as needs must.
The most important consideration here is that the private mortgage loan, taking into account pricing, urgency, location, gearing, flexibility, its direct nature and all other factors is simple. There must be a
- significant benefit to all parties
- reliable information and material provided that will stand up under scrutiny
- a strong exit strategy
CONTACT LITTLE ROCK FOR PRIVATE MORTGAGE LOANS
Contact
Steven Acworth
Private Mortgages
