What is a Private Investor Mortgage Loan? When you cannot meet one or more of the qualifying requirements for a traditional mortgage loan or government lending program, a private investor mortgage loan could be exactly what you need. Some reasons for not qualifying for a traditional mortgage include too low of a credit score caused by an event or other unavoidable situation, the inability to document income in the format or to the extent that is required or the property itself is not within guidelines for a traditional mortgage. A private loan gives quite a bit more flexibility when it comes to individual situations that do not fit any other loans' criteria. With a private investor mortgage, paperwork is lessened, and the timeline between the date of application and the closing date is substantially shorter. The higher upfront cost is a tradeoff for faster access to capital and a much less stringent approval process. Apply Online Get a personalized custom loan with the help of our professional loan officers, fast response.
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A private investor is more likely to be found among your family, friends or peers. Sometimes private investors are looking for talent and unique products to finance and can be found advertising online or in a business magazine. Some agencies provide listings of private investors and can help small businesses get hooked up with them. Loans Loans vary, but are often the most common way to obtain financing for a small business. Establishing a good relationship with a banker is important. Bankers are extremely helpful and well trained in the loan process, and can often make suggestions that can save you a lot of time and energy. Loans vary in amounts, and the length of time allowed for paying them back. The interest rates on loans can range by a few percentages, but each percentage can make a difference. There are fixed rates and rates that can go up and down, depending on the economy. Be sure to ask your banker about what type of loan is best for you. From there, they will have you fill out a loan application.
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Fannie Mae and Freddie Mac set the borrower eligibility guidelines for conventional loans, like the 30-year fixed and 15-year fixed. They also keep cash flowing in the mortgage market by purchasing conforming loans, which are conventional loans under the maximum loan limit for the county of the house. After buying conforming loans, Fannie Mae and Freddie Mac will package them into mortgage-backed securities and sell them to private investors. As homeowners pay off their mortgages, the payments are collected and distributed to the private investors who bought the mortgage-backed securities. Unlike government agencies, Fannie Mae and Freddie Mac don't insure loans. This means the investors aren't guaranteed compensation if borrowers don't make their loan payments. Since the investors aren't protected, conforming loans have stricter guidelines for determining whether a borrower qualifies or not. The guidelines reduce risk by preventing lenders from using the investor's money to make bad loans.
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Online or in person. - or - Talk To Us If you can't talk right now and prefer to talk over the phone? Fill out a short form and a professional loan officer will call you. How to get approved for a Private Mortgage Loan Private money borrowers secure their loans through equity rather than creditworthiness. Therefore, these types of loans typically referred to as equity-based mortgage loans, where the collateral value is of more significance than your financial situation. Private investor mortgage loans come with shorter terms typically around five to fifteen years and are temporary loans until the applicant can restore credit, improve their current financial situation, or make necessary improvements to the home to qualify for a refinance program to meet their long-term needs. We will work with you to find the right strategy to create a more stable and gainful future. Why Choose a Private Lender? Your investment is unique, and the private mortgage will be structured to fit your objective.