People take mortgages from either banks or private mortgage brokers. They apply for mortgages to buy a new house, acquire a rental property, and refinance their existing mortgages. At the end of their mortgage term, they can either opt for a mortgage renewal or choose a better mortgage deal from an Edmonton mortgage broker. We are a network of mortgage brokers spread across Canada. We offer many mortgage options such as rental property mortgage, draw mortgage, second mortgage, HELOC, private mortgage, and sub-prime mortgage. Here we are going to look at the key differences between a rental mortgage and draw mortgage.
A rental property mortgage is given to people who intend to buy a rental property or an investment property.
A draw mortgage is also known as a new home construction mortgage and is usually given to people who want to build a new home.
The benefits of taking a rental mortgage are many. Your mortgage is paid down, while you realize the property appreciation. Rental properties are a smart and safe way of investing.
The benefits of taking a draw mortgage are that down payment required is minimal if the builder has brought the land or has an arrangement with the developer. The lender will finance up to 75% of the lot value.
It is not easy to qualify for a rental property mortgage. Edmonton mortgage brokers have options that allow you to use anywhere from 50% of the rents added to your income up to 80% rental offset. You need 20% down payment while buying rental property.
You can qualify for a draw mortgage if you have the minimum down payment required (the percentage varies from every lender), if you have a good credit score and if your builder has brought the land to your home.
You get the entire mortgage amount together.
You get the mortgage amount in 3-4 ‘draws’
Most Edmonton mortgage brokers offer both rental property mortgage and draw mortgage. If you are on the lookout for a good mortgage option then contact our experts. Ratedeals.ca is an online mortgage authority for all your financing needs. Our mortgage specialists at Ratedeals.ca will help you fetch the best rates for your mortgage requirement.