Guide to Private and Second Mortgages

A guide to borrowing from private and alternative lenders to support your short-term financing needs. If you're ready for personalized advice, go ahead and click "get started" below.

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In need of short-term financing?

Sometimes finding a mortgage isn’t so easy. If you have a spotty credit standing or inconsistent income, the traditional lenders might deem you a credit risk, and sourcing a mortgage can be a challenge.

In these cases, which are fairly common and nothing to be worried about, we might want to pursue a private lender or other alternative source of financing.

In the past, borrowing from a private lender had a negative connotation, implying sky-high rates and sketchy practices. But the regulations have tightened up, and with the right mortgage broker guiding you through the process, it’s a viable approach to meeting your short-term financing needs while you get your credit and finances on the right track.

A second mortgage may be the right solution. A second mortgage implies you already have a primary mortgage (hence the name). If you are unable to pay your mortgage obligations, the lender on your primary mortgage gets priority, and the second mortgage lender is only paid back if any funds are remaining. For this reason, the rates on a second mortgage are relatively high.

Source private lending or a second mortgage safely and securely

At Robinson Mortgage, we’ve helped countless individuals in Chilliwack, Abbotsford and throughout the Fraser Valley find short-term financing when traditional lenders were not an option.

Ready to get started? Let’s find a solution that works for you.

Private and Second Mortgage FAQ

Why would I get a second mortgage?

If you need to borrow money, secured by the equity in your home, and avoid paying penalties for breaking your existing mortgage, a second mortgage is a viable option.
How do I qualify for a second mortgage?

The most important factor in obtaining a second mortgage is the equity in your home, determined by the home’s appraised value minus any outstanding mortgage balance. Your credit history and income are not major determinants.
How much can I obtain for a second mortgage?

You can borrow up to 80 percent of the value of your home in a combination of your primary and second mortgage. So if your home is valued at $600,000, and you have a $150,000 mortgage balance, the maximum amount of a second mortgage would be calculated like this:

80% of $600,000 = $480,000
$480,000 – $150,000 = $330,000

$330,000 would be the maximum available amount for your second mortgage.
Why would I choose a private lender over a traditional bank or mortgage lender?

A private lender may be your only option. We’ll review your finances and requirements, and we’ll offer the best solutions for your situation. If traditional sources for mortgage financing are not willing to lend to you, we can consider private lending. Private borrowing provides a chance to get the financing you need in the near term while you upgrade your credit standing and get on the path to financial health.
What are the costs associated with private lending?

The interest rate you will be offered through private lending is typically higher than a traditional mortgage, since situations requiring private lenders tend to involve more risk.
What terms are available when borrowing from private lenders?

Private lending terms are typically shorter. While a traditional mortgage term might be three or five years, private borrowing may be one- or two-years.

Hear from a few of our happy customers

Val Meyer

Matt was wonderful when we were buying and selling our house. As soon as we had a place we were considering, he would crunch the numbers for us and see if it was doable or not. Hes very quick in response time and easy to communicate with. This is our second time using him and we will continue to use his services in the future. Thanks Matt!

Nico Abais

As a first-time home buyer, my first resolve was to search for information online and sure enough I find bits of information all over the place. Then we were introduced to Matt. He will answer all your questions in a timely manner and guide you with the whole process and expectations. Matt will work his way to get you the best rate!

Tash Stobbart

Robinson Mortgage were very helpful in obtaining our first mortgage. We had difficulties dealing with banks because my husband is a contractor and has multiple T4’s and his income tax is complicated but Matt and his team made it easy. I would highly recommend to anyone looking for a mortgage and in fact I have sent friends his way.

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Expert mortgage advice is just a phone call away

Got questions? We’re happy to help. Reach out anytime or schedule a time that works for you. And we’ll help you get closer to your dream home.

Meet Matt

Robinson Mortgage is owned and operated by Matt Robinson, a professional mortgage broker based in British Columbia’s beautiful Fraser Valley. Matt has helped countless people in Abbotsford, Chilliwack, Mission and beyond navigate the process of finding financing for their home. Whether you’re buying your first place, consolidating your mortgage, or getting ready for a future purchase, Matt is your man with a mortgage plan.
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