Lenders
In layman’s language, lenders could be individuals, public or private entities, trusts, credit unions, insurance companies, mortgage investment companies, banks that can be engaged to provide loans or mortgages, insurances, and related financial leverages.
The lender provides the loans to the borrower, which is considered an investment with expectations of getting a better return over the amount they lend. Of course, with massive competition in the market, every lender from time to time, launch various offers, promotions and enhance privileges to lure more borrowers into borrowing from them.
Mortgage Lenders vs. Mortgage Broker
When it comes to buying a home, lenders providing home mortgages and insurances are called Mortgage Lenders, and it is crucial to choose the right lender to help you save time and money and avoid any hassle down the lane. When you are ready to buy or sell your home or any real estate asset, you will usually consult a Mortgage Broker. A mortgage broker is a licensed financial expert who acts as an intermediary between a borrower and a lender. They typically have access to various mortgage lenders available and can help you get the best insurance package based on your need. They can guide you best options to choose from and share the best possible quotes and deals based on your requirements and current financial situations. But when it comes to Direct Lenders, you need to do your research and due diligence to find a better deal out there in the market and ensure there are no hidden fees or contracts.
Financial Services Provided by the Lender
Mortgage Financing & Refinancing
The lender provides the loan to the borrower to buy the home, land, condo, or any other real estate asset. Also, when the current mortgage term matures, the lender can provide the mortgage refinancing if the borrower chooses to renew their mortgage.
Closing Mortgage
The buyer can get a different mortgage from the lender to cover the closing costs, including fees and the purchase price of the home or property. Similarly, the seller can also opt-in for this mortgage.
Purchase Plus Improvement Mortgage – this mortgage is available to buyers of existing homes that would require additional work or renovations to make them more liveable. It grants extra money to cover the renovation costs above the purchase price of the house. For first-time home buyers, this might require CMHC approval and mortgage default insurance.
Build/Construction Loan
Mostly a short-termed with higher interest loan used by home builder or person building custom homes to cover the cost of construction. This loan does not cover the entire home build project cost but a bridge loan to cover the expenses until construction completes. Once the home is built, the borrower applies for a regular low-interest mortgage, including rollover from an existing construction loan.
Lines Of Credit
The homeowner will use the existing home as equity to get access to the cash amount that can be used to cover the personal debt, renovation, or other property purchases. Its value is solely based on the home’s value and often provides loans at low-interest rates.
