Private Lenders Ontario

Private Lenders Ontario

If you live in Ontario, Canada, and you need to raise funds quickly, you can apply to private lenders in Ontario.  Finding a good private lender in Ontario is not very difficult.  Just search private lenders Ontario on the internet and you can find many websites of private lenders.

If you have bad credit and can’t get a loan anywhere, Private Lenders may be your last-resort, especially if you need to secure financing assistance immediately. These private loan companies offer quick and easy financing services to borrowers like you who require faster lending.

In general, the concern for most bad credit borrowers and sometimes for self-employed people looking for finance is not the loan interest rate they may pay but rather the strict lending requirements due to their particular situation.  If you are having a problem in qualifying for a conventional loan or even a mortgage, a private lender is an option for you.

Who Needs Private Lenders Ontario?

Services provided by Private Lenders in Ontario and across Canada guarantees individuals and institutions who find it difficult to get finance from traditional sources an access to different financing services. For those who live in Toronto, Private Lenders Toronto is a great option to consider. These services include financing for property Investments, business finance loans and even home loans and personal loans.

Often, people who need the help of private lenders in Ontario are property developers and house builders.  Developers require private lenders for all sorts of deals. One of the most common deals is getting a short-term loan from the lenders to complete a building project.  Sometimes the builder goes into a joint venture deal with the private lender where the private lender shares in the profit generated by the project.

Self-employed individuals, no matter what business they are in, are also a great target for these private lenders.  They make a lot of deals with these people.  There are many self-employed individuals with properties to use as collateral for borrowing but because of poor credit find it difficult to get financing.  All private lenders in Ontario love to do business with such self-employed people.

For individuals in Ontario who desire to build their own house rather than buy, private lenders in Ontario are a great option for raising finance for the project.  Depending on your building plan, building your own house can cost a lot of money, an amount you may not be able to secure from banks and traditional lending sources.  However, you can secure any amount of money from a private lender in Ontario, if you can show that you can pay back the loan.

Apart from the fact that they make money from these deals, most private lenders in Ontario are actually committed to supporting businesses in the community by offering them support and helping with their expert knowledge in the respective industry.

Pros and Cons of Private Lenders Ontario

As with most things in life, there are pros and cons to consider when dealing with Private Lenders in Ontario or anywhere for that matter.  Consequently, to minimize a risk you may face in getting finance form a private lender, you may need to find a broker to assist you in securing funding from a private lender. This is not to say that you won’t face any financial risk if you use a broker.  Brokers may have the experience of dealing with certain private lenders they may recommend as good lenders to do business with.  This should minimize the risk of dealing with a rogue private lender.

Even though your bank may not be able to assist with your loan request, they may be able to recommend a private lender or know a broker who can recommend a good private lender.

Here are some other pros and cons to consider if you are thinking of getting help from a private lender.

Con: High-Interest Rate

Interest rates charged by private lenders in Ontario and most provinces in Canada is generally higher than rates from banks or conventional lenders.  The interest rate range is from 12 to 20 percent per year.  

Con: Short Payback Period

Loans made with private lenders are expected to be repaid within 6 to 12 months.  However, it can extend up to 2 years, which is the maximum length of time the lenders will allow for repaying the loan. This is unlike traditional lenders which will allow up to 30 years in some cases to pay back the loan.

Pro: Short Approval Process

One of the most attractive reasons for getting finance from an Ontario private lender is the ease and speed at which they operate. Approval process only takes a couple of weeks with private lenders in Ontario.  A conventional loan may take you around 30 to 45 days to complete.  This is trade-off for the higher interest rate you will pay for a loan from private lenders.

Pro: Less stringent requirement

A Loan from a private lender is great option for homebuyers who cannot qualify for a traditional loan.  Great for self-employed individuals who cannot provide a proof for steady income but can prove they can pay back the loan or have enough collateral for the loan.

Pro: Great for “Flippers”

You might consider short repayment method if you plan to sell your property in a short span of time.  You can also do extensive renovations for your home to sell at a higher price. Profit out of this investment is a good return for you, which you can use to repay your loan to private lenders.

Pro: Geared Toward “Fixer-Upper” Properties

Homes that will need to undergo extensive renovations cannot qualify for a conventional mortgage.  Even if the borrower has a good credit record, for these types of properties there is no guarantee that the loan will be approved.  This is where private lenders play an important role.
Finally, bear the following in mind when deciding to use the services of a private lender:

1. Know the cost involved.  You need to do some calculation to see if the deal will be profitable for you.
2. Talk to your broker.  Work with them to guide you through the process.  They are experts in their field and they know what the best options are.
3. You may also check the interest rate offered by other private lenders and compare rates before you choose a lender.

Conclusion

If you fully understand the pros and cons involved in securing a loan from private lenders, you will lessen the risk involved in working with private lenders.  Best deals come from thorough research and understanding. So, make sure that you always do your own research first before you get a loan from private lenders.

If you live in Ontario, there are plenty of private lenders in Ontario who will be willing to give you a loan if you meet their lending criteria. As mentioned from the beginning, the easiest way to find a private lender that based in a city in Ontario is to google private lenders Ontario.