In Ontario, and I imagine in the rest of Canada too, hard money lenders (called private lenders in Canada) are not allowed to advertise unless they are licensed mortgage agents. So they are hard to find unless they are family/friends. They must go through mortgage agents! The strategy in Canada is to align yourself with a mortgage agent who has access to private lenders. They will also have access to MICs and B-lenders. B-lenders are somewhere in between A-lenders (banks) and private lenders, and many also work exclusively with mortgage agents. Keep in mind you’ll need some money down. The private lenders and b-lenders I work with are great but all require at least 20% down.
Bottom line is it’s a bit different in Canada and your best strategy is to add a mortgage agent as part of your “team” along with realtor, lawyer, property manager, etc.
Hi Steven, the best hard money lender will meet the following:
1. be willing to work with you (ie lend you the money)
2. give you the best rate and terms
3. require minimum paper work from you
4. minimum collateral
5. they have deep pockets
Once you find a good hard money lender, make sure you treat them right. That way they are willing to work with you over and over again. There is so much more I can write about this. Can you be more specific with your question?
Hey thanks so much for your reply! I was hoping to hear some of the common lenders or institutions that my fellow canadians might commonly use for hard money loans.
@Steven Wocknitz hard money lenders in Canada don't call themselves that. By far the best you will get are private individuals who are willing to lend. They are hard to find though. Our institutions that are similar to hard money lenders are MICs (Mortgage Investment Companies). Since financing is already hard for homeowners due to the qualfying rules, the MICs also do a lot of private first and second mortgages to homeowners. I have find the majority of the time the MICs will be accessed through brokers, who charge an additional broker fee. An example of a MIC is Gingko MIC. MICs generally charge a lot in points and have high rates, and typically won't lend above 75%-80% of purchase. Some brokers will also have access to private individuals who are willing to lend, which can be more flexible.
@Steven Wocknitz It's more common in Canada to call hard money lenders B lenders or non-banks.
@Luc Boiron mentioned MICs. A mortgage investment corporation, or MIC, is a mortgage investment and lending company in Canada. A MIC manages a portfolio of secure mortgages where individual investors pool their finances to create mortgage loans. Some MICs in Canada may diversify their portfolio to include anything from smaller second residential mortgages to mortgages for commercial development properties.
I have found in my experience working with B lenders (i have a long list of them) is that each MIC has its own investment strategy. However, unlike property loans from banks that will lend up to 100% of a property’s value, the ideal MIC loan is generally around 60% of a property’s value, and does not exceed 85% for added security.
If you are an individual looking for safer and consistent returns for your $$$, with 100% of the net profits returning to you, investing in a MIC might be an option.
In Ontario, and I imagine in the rest of Canada too, hard money lenders (called private lenders in Canada) are not allowed to advertise unless they are licensed mortgage agents. So they are hard to find unless they are family/friends. They must go through mortgage agents! The strategy in Canada is to align yourself with a mortgage agent who has access to private lenders. They will also have access to MICs and B-lenders. B-lenders are somewhere in between A-lenders (banks) and private lenders, and many also work exclusively with mortgage agents. Keep in mind you’ll need some money down. The private lenders and b-lenders I work with are great but all require at least 20% down.
Bottom line is it’s a bit different in Canada and your best strategy is to add a mortgage agent as part of your “team” along with realtor, lawyer, property manager, etc.