Recently we were approached by a church (not for profit organization) that purchased a small commercial property but at the time did not have the financial history to approve for a conventional commercial mortgage. As a result, they gave their down payment to the vendor and the vendor agreed to give them a mortgage at a slightly higher interest for three years. They felt at the time that leasing space would be more expensive than owning space and making a mortgage payment so they completed their transaction with the vendor. They now have approached us through their commercial real estate agent looking to payout the mortgage provided by the Vendor given the current interest rate environment. With their financial statements up to date we will be working to get them a new mortgage at lower interest rates and help them own their space at a lesser cost than what they have paid previously. Their financial statements prove that they have made the payments historically at a higher interest rate which helps a bank feel comfortable that at a lower interest rate they would be able to make the new mortgage payments easily. If you would like us to provide you with some options, please email email@example.com or visit www.bridgecap.ca/dylan
Whether you are looking to borrow money for a residential mortgage, a commercial mortgage or business loan you should be aware of the 5 most important points a bank or lender will look for in determining your approval.
1. Character – Do you make your payments on time?
2. Capacity – Do you have money to make the payments?
3. Capital – Do you have financial stability and net worth?
4. Collateral – Do you have an asset that can be used to as security for the loan?
5. Conditions – Other items related to your request like location, property type, etc.
Your answers affect your interest rate, the amount a bank will lend you and how much (if any) they will charge you as a fee. A mortgage broker can help you put together your 5 answers and can also explain them to a bank on your behalf. If you want to know how you strong your 5 answers are, please email us at firstname.lastname@example.org or visit www.bridgecap.ca/dylan
There is a lot of advertising and information available about your personal credit score but most people are not aware of the impact their credit score can have on their borrowing. The lowest mortgage rates are available to individuals with high credit scores and if you do not have a high score you may end up having to pay a higher interest rate for your mortgage. There are many private lenders in the marketplace that will charge as much as 5-10% more than a bank for lending money to someone who does not have a high credit score. Banks have specific products available for individuals that have high scores and also change their lending criteria for these individuals. A borrower with a 700+ credit score could borrow more money than a borrower with a score of 699 or less. Your credit score is very important and if you would like more information about how it could impact you – email me at email@example.com or visit www.bridgecap.ca/dylan.
Often times our clients will ask about the kinds of transactions that banks are interested in funding. For the past year banks and lenders have been very competitive to fund mortgages for owner occupied properties over investment properties. An Owner Occupied property refers to real estate that is purchased by the same individual or business that intends on occupying it. Locally, we have many businesses that have leases expiring and have considered changing their monthly lease payment into a mortgage payment. There are many properties to choose from and in a lot of cases a business that purchases a property can save money compared to leasing the same type and size of property. For this reason, banks and lenders are interested in working with these types of transactions as they present opportunities to lend money to solid businesses that have demonstrated cash flow and financial stability. Compared to Investment Properties, which would be real estate that is purchased for investment purposes and not occupancy purposes, banks and lenders are still interested in seeing the transaction but we have experienced slower turn around times and a lower level of interest compared to Owner Occupied properties. If you are considering turning your lease payment into a mortgage payment, send me an email at firstname.lastname@example.org or visit www.bridgecap.ca/dylan and I would be happy to run some math.
We were approached recently by two businesses that were looking to restructure their existing financing to save interest and improve cash flow. In one case a business had used unsecured debt to finance renovations to his business properties resulting in double digit interest rates. In the other case, a business owner with substantial net income has an opportunity to purchase another business property and his bank can’t seem to understand the various parts of his existing business. Both businesses were not able to talk to their bank about their situations and we were able to understand their need and get them the options that made sense. If you want to discuss your situation, please send me an email at email@example.com or visit www.bridgecap.ca/dylan
It appears that more and more people are looking to have someone work for them to help them understand their options. Both residential and commercial borrowers are trying to learn more about the various banks and lenders available and the difference between each of them. Like most businesses, banks and lenders have a certain type of client that they want to work with and trying to figure that out can be frustrating and time consuming. As a mortgage broker, we are constantly talking to banks, lenders and clients to shed light on how to put a deal together. A good mortgage broker will save you time and money so that you don’t need to do the shopping yourself. Whether you are purchasing a property, refinancing existing debts or are looking for other types or loans – we would welcome the opportunity to help. Email firstname.lastname@example.org with any questions or concerns that you might have or visit www.bridgecap.ca/dylan.
We had the opportunity to work with a business owner that was looking to make better use of the money they spend on rent by purchasing a small industrial bay. The business was spending approximately $13.00 per sq. ft. on rent (not including operating costs) and was able to purchase a unit in a warehouse for $9.00 per sq. ft. The business was paying almost $1,900 per month in rent and by purchasing the unit the mortgage payment is almost $1,400 per month. A savings of $500 per month and the business is building equity as the mortgage is paid down and the property value rises over time. The business has been operating for more than 10 years and expects to operate for at least another 10 years which means that they are now making better use of the money being spent to have a location. If you own a business and are interested in understanding the options your business might have, please email email@example.com for more information or visit www.bridgecap.ca/dylan