The title is more a way to describe a mortgage broker that has a focus on private mortgage lending as well as the experience necessary to be proficient at this slice of the Canadian mortgage market.
To be an effective private mortgage broker, there are a number of things the broker will need to be bringing to the table.
First, the individual needs to have direct access to private lenders or investors that actively placing funds for the type of property the applicant is trying to finance, in the area where the property is located.
Because there are so many different types of properties on the market, to be an effective private mortgage broker in any one area will likely involve working with a number of different private lenders or private lending groups. The larger the geographic area the broker or agent claims to cover, the more sources of private money he or she is going to need to have access to.
At to the above the fact that all private lenders are different in their own right and conduct their own business and make their own decisions in their own way.
This further supports the need for a private mortgage broker to be working with a number of different private money lending sources, otherwise the broker will have a hard time matching up borrower and lender.
One of the key points to remember here is that most mortgage brokers do not have direct access AND developed relationships with private lenders. Even if they have a direct relationship with a lender, its likely not enough to cover off all the different private mortgage financing requests the broker may receive.
What ends up happening is that mortgage brokers and agents that get property financing requests that will require a private mortgage send the deal to other brokers to try and co broker the deal and get something out of it.
This process can become one or two or even three steps removed from the initial broker, providing a very poor level of service to the borrower waiting to hear back due to all the people now involved.
Second, the private mortgage broker must be good an sizing up the best lending strategy for a given property and then being able to quickly determine which of the private lenders he or she works with will be interested in the deal.
Knowing the business requirements and personality of the private lender goes a long way to completing a transaction quickly if at all.
Third, any private money broker you consider working with should operate with a high degree of integrity and professionalism.
Even though the mortgage broker profession is regulated, there are individuals out there that either operate in a gray area or are representing themselves as an agent when in fact they are not qualified or licensed to do so.
For the more straightforward deals, a good private mortgage broker should be able to quickly assess your situation over the phone and provide you with private mortgage options right away.
More involved deals are going to take more time, but that’s also why you need to be working with someone who has the experience and track record the supports their ability to locate and secure the financing you’re looking for.
If you are in need of a private mortgage, or you would like to better understand your options, give me a call so I can quickly go over your situation with you and provide relevant private mortgage options for your consideration.