Alternative Mortgages:
Tailored Solutions for Unique Needs
Life doesn’t always fit neatly into the boxes traditional lenders require for mortgage approval. If you’re facing challenges meeting the strict criteria of major banks, alternative mortgage solutions might be the key to achieving your homeownership or financial goals.
What Are Alternative Mortgages?
Alternative mortgages, often provided by “B lenders,” offer more flexible approval criteria compared to traditional (A lender) mortgages. These solutions are designed for individuals with unique financial circumstances, focusing on the bigger picture and prioritizing equity in your home as loan security. In today’s housing market, alternative lenders play a vital role by providing options for Canadians who may struggle to qualify for traditional financing or who need more customized solutions.
What Sets Alternative Lenders Apart?
Unlike traditional lenders, alternative lenders prioritize flexibility over rigidity. They’re equipped to look beyond strict credit scores and conventional income documentation, focusing instead on your overall financial potential.
However, this added flexibility often comes with higher interest rates and fees, reflecting the increased risk these lenders take on. Despite this, alternative mortgages can be a lifeline, providing a path to homeownership or financial stability when traditional options fall short
Why Consider an Alternative Mortgage?
Here are some common situations where alternative mortgages can be a game-changer:
01
Debt Consolidation
Combine debts into a manageable payment plan while improving your credit.
02
Bridge Financing
Secure funds while transitioning between selling and buying a home.
03
Non-Traditional Income Sources
If you’re self-employed, earn commissions, or have complex income, alternative lenders offer more leniency in assessing your financial situation.
04
Divorce or Separation
Smooth the transition of property ownership during significant life changes.
05
Second or Third Mortgages
Access additional financing without refinancing your primary mortgage.
06
Short Term Needs
Solve immediate financial challenges while working toward a longer-term solution.
Looking for flexible mortgage options?
Complete your profile and explore alternative lending solutions that work for you.
Who Are Alternative Lenders?
Alternative lenders encompass a broad range of institutions, including:
It’s important to note that private lenders may come with significantly higher rates and fees. If you’re considering this route, our team can often find a more cost-effective solution through a regulated alternative lender.
01
Smaller Banks
These are as regulated as the major banks but often provide more flexible products to meet diverse client needs.
02
Credit unions and mortgage finance companies (MFCs)
Non-bank lenders that specialize in mortgage products with broader qualification criteria.
03
Private lenders
These lenders operate with less regulatory oversight and are often a last resort. They rely primarily on home equity and location rather than income or credit.
What to Expect With an Alternative Mortgage?
How Do Alternative Lenders Handle the Stress Test?
Most alternative lenders are required to adhere to Canada’s mortgage stress test, which ensures borrowers can handle potential interest rate increases. However, non-bank lenders may offer more competitive rates, which can help improve your affordability and make it easier to qualify.
Special Options for Self-Employed Borrowers
Traditional Lender Rules for Self-Employed
Uses personal tax returns only
Harder to qualify due to fluctuating income
Stricter credit score requirements
Alternative Lenders Make It Easier
Accepts business bank statements & cash flow
More flexible debt-to-income ratio
Lower emphasis on credit score
What About
Poor Credit?
Yes, you can still get a mortgage with poor credit. Your approval will depend on factors like the equity in your home, its location, and your overall financial situation. Alternative lenders provide opportunities for borrowers with less-than-perfect credit to rebuild and achieve their homeownership goals.
The Role of
Alt-A Products
Alt-A products cater to borrowers with non-traditional income sources, such as self-employed individuals or those with complex earnings. These mortgages, often insured by a default insurance provider, are considered low-risk to lenders and can offer competitive rates.
Why Choose Us for Alternative Mortgages?
We understand that no two financial situations are the same. That’s why our team of experienced brokers works closely with you to find the best alternative mortgage solution for your needs.
With access to a wide range of lenders, including both regulated alternative lenders and private lenders, we’ll help you navigate your options and choose a strategy that fits your goals.
Why work with us?
Access to multiple lenders for customized mortgage strategies.
Expert guidance to help you transition to better products in the future.
Start Your Journey Today
Don’t let traditional lending criteria hold you back. Contact us today to explore alternative mortgage options designed for your unique situation. Whether online, by phone, or in person, we’re here to help you achieve your homeownership and financial goals.