Home Equity Loan / Private Mortgages
How does a home equity loan work? Like many Canadians, your home may be your most powerful financial asset. Using a home equity loan as a financial solution is a key financial stepping-stone.
You may be an expert in your field but still be wondering if you’ve done all you can to advance your personal financial future.
If you’re thinking about renovating your home, financing an education, or starting a business, apply online today with our simple application or contact us for more information.
If you’d like to learn more about what home equity financing let’s start with the basics.
What is Home Equity?
Home equity represents the money that you have invested in your home, and consequently, the portion of your home that is yours – free and clear.
For example, suppose you own a home that is valued at $250,000. If you owe $100,000 on your mortgage, your equity can be calculated as:
Current value of home ($250,000) minus the amount owed on mortgage
($100,000) = Your current equity ($150,000)
Rising Real Estate Prices
Home equity is not based on what you paid for your home, but on the current value.
Notice that we said, “current value of your home”. If real estate prices have gone up in your area, and the value of your home has increased, your equity will have increased as well. Therefore, if the $250,000 home described above increases in value by $50,000, your equity in the home will also increase by $50,000.
Keeping an Eye on the Housing Market
The equity in your home is tied to market demand for homes like yours because equity is tied to current value. The amount of equity you have in your home, therefore, can rise and fall according to conditions in the housing market. Keeping informed about your local real estate market is important if you are to take full advantage of your home as an asset.
Equity = Borrowing Power
To sum up, the equity in your home gives you the power to borrow money to finance your future.
Let’s look at how this works.
“Lend-able equity” represents secure money that you already have, means less risk for the lending institution and more favorable home equity loan terms for you!
People who loan you money need assurance that they will be paid back. One of the simplest ways to provide this assurance is to offer what is called collateral. In the case of a home equity loan, this means that the equity in your home is offered as a guarantee that the loan will be paid off.
To determine the amount of money they are willing to lend you, Ontario Lending Solutions will calculate a figure, which is commonly called lend-able equity. This is primarily based on the equity in your home, but also considers factors such as perceived risk, how long you’ve lived in your home, and the amount of your mortgage down payment. Our representative can explain which factors apply in your situation.
In the eyes of lending institutions, lend-able equity represents secure money that you already have. Because this means less risk, they will loan you money under better terms than you would otherwise get. Everything else being equal, a home equity loan is the best financing deal you can get.
Private Mortgage Funds Available for First & Second Mortgages
Within major urban & rural centres we have a large pool of private funds that can help with either a first mortgage or second mortgage up to 85% of the value of your home.
We have been helping clients with:
- Poor Credit
- Power of Sale
- Mortgage Arrears
- Property tax Arrears
- Self Employed
- Pension and disability income only.
- Non-residence accepted
- Rental Properties accepted
- Agricultural Financing up to 55% LTV
At Ontario Lending Solutions we focus on providing efficient & effective alternative lending solutions. We offer some of the lowest rates in the industry and have quick turnaround times. So if you are seeking short term financing and your current bank is out of options feel free to call or email us regarding your situation. At Ontario Lending Solution we work with clients to offer flexible alternative financing solution to meet their needs. If traditional lenders (banks) are not helping with suitable financing solution, we can help. As a specialist in private lending we at Ontario Lending solutions specialize in unique situations, each mortgage customized to meet the needs of the borrower.
In closing, we work with our clients closely to offer the best possible solutions to meet their immediate needs and long term goal.
Interested in a private mortgage or a home equity loan? Contact us today
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We were very pleased with the services that Ontario Lending Solutions provided us recently. Ontario Lending Solutions were very professional in their dealings with us throughout the process, and were very quick to respond to any inquiry that we had throughout the process. Ontario Lending Solutions were able to provide various options throughout the process and explained the pros and cons of each option. Whether you are looking for your first Mortgage or renewing an existing one we would highly recommend Ontario Lending Solutions it will save you money, you will have less stress and in the end you will get the right mortgage for you.
Jason & Julie Hicks