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Wednesday, 25 June 2014

How a vendor take back can help when you short on down payment

When you find yourself being short on the down payment, due to bank wants you to put more down in order to approve your mortgage request, there is another possibility and the seller is the one who can help you. A VTB is when the seller offers financing on their own property they are selling, called the Vendor Take Back.  For instance you might have 75% LTV from the lender or bank; a 15% VTB from the seller and 10% from your own funds. Bank wants only give you a 75% mortgage when you have credit issue as well, allowing a VTB to 90% LTV of the property you are purchasing. We can structure a deal like that and help you to convince the vendor as well.
Also if the lender lived in the property he will not have to pay tax on the equity he has made, so for him it is no matter what the price is showing on the Offer to Purchase, if you know what I mean. Important part is the property to appraise to the value was indicated on the OTP
For the buyer, It’s a great way when you have a shortfall in funds.  The VTB acts as a second or third mortgage, depending on the financing structure.  However, you as the buyer must make sure that the seller agrees to subordinate the mortgage.  
This means that the VTB will agree to go in behind other lenders and will recoup funds in the event of a default in that position.  If for instance you have to get a Private Lender mortgage, they will always want to come in before the VTB – without a subordination clause, it would be difficult to do this and you would not get the Private Lender to lend to you.
More on this type of agreement you talk to our president, Zoltan M. Padar as he is not only a private mortgage lender, but also the mortgage broker of MortgagePRO, leader of a highly trained and very capable team of mortgage brokers.
The team has education not only to get you the lowest possible rate and the best product, but also able to combine institutional and private funds for approval. Able to provide a plan and a solution and will not live anybody behind!

Tuesday, 17 June 2014

CMHC cutbacks are the signs of market turbulence?

CMHC crown corporation’s most recent restructuring raises the question; is the insurer gearing up to leave the market, amidst speculations where the market is heading to reduce tax payers exposure to bad mortgage loans?
News on CMHC discontinuing to provide loan insurance for the financing of multi-unit condo construction, following late-April announcement from the crown corporation that it will no longer insure second homes and self-employed individuals who do not have third party income validation.
CMHC provided stability to the real estate market during the last decades, but now two private insurers Genworth & Canada Guaranty will fill the void of CMHC, can they do that?

You be the judge, observe and learn the latest news from the only information highway will always tell you how it is. The facts and the truth are wonderful tools to ready yourselves to the future and determine your moves.