THE RISKS OF PRIVATE LENDING AND HOW TO MITIGATE THEM?
Investing in private mortgages can provide attractive returns, but it's crucial to understand and mitigate the risks involved. To do...
At Streetwise Private Capital, we make it easy for you to invest in private mortgages and earn a steady stream of income.
Award winning brokerage serving real estate investors for over 10 years. Our team has the expertise and knowledge to help you achieve your real estate goals.
We have developed an exclusive methodology (STREETWISE LendRightTM) to help assess and manage the risks of private loans on behalf of our lenders.
This increases the likelihood of a successful exit while earning excellent returns.
Up to 80% loan to value in markets that are based on our BEST to INVEST research. These markets have the following strong fundamentals:
CREDIT SCORE: 640 or higher
TAXES: Proof of no personal taxes owing to CRA
NET WORTH: Confirmation of personal net worth (only required on mixed use and 5+ unit multifamily)
INCOME: Proof of qualified or stated income
CONDITION: Run down property will demand a higher rate premium (0.5% or greater)
ZONING: Confirmation that the use of the property conforms to zoning
PROPERTY TYPES: Residential (1-4 units), 5+ Unit Multifamily, Mixed-Use (No Land, No Recreational Properties, No Industrial)
MARKETABILITY: Max sale time (based on the appraisal report) of 3 months for 1-4 unit residential properties, and 12 months for mixed-use or 5+ unit multifamily
RANK: 1st or 2nd mortgages
EXIT STRATEGY: Confirmation of exit strategy through full deal underwriting of anticipated future scenario IS COMPLETED UPFRONT
USE OF FUNDS: Property acquisition, renovations, additions, construction. No debt consolidation or payout of another private (exceptions on deal by deal basis)
We are here to support your success in real estate investing
You must be wondering what return can I expect when I lend on private mortgages through Streetwise Private Capital? Our answer is: Between 9%-11% on a first mortgage and between 12%-14% on a second mortgage (including fees). However, what is often overlooked in the process of private lending are the risks associated with the returns. Generally, the higher the risk the higher the returns.
You can mix and match the types of funds you use for lending: both registered and non registered. For example: you can use funds from your RRSPs, your spouse's RRSPs, TFSAs, or other non-registered savings. It is even possible to use funds from both your TFSA and RRSP accounts. The key is to have a self-directed registered account with a trust company (such as Olympia Trust) if you would like to lend registered funds or TFSA funds. Our team can help you setup a self-directed account with Olympia Trust to facilitate lending through your / your spouse’s registered accounts* *$500 setup fee applies
Once you become an approved private lender with Streetwise Mortgages, you will be introduced to your Account Manager who will: 1. Present you with private lending deals that are suitable for your goals, budget, and risk appetite 2. Assist you with setting up a self-directed account if you wish to invest using registered funds and do not yet have a self-directed account setup 3. Answer any questions you have throughout the lending process
When lending through streetwise mortgages, your loans are administered through a licensed mortgage administrator.
This means that:
A. You get the interest from the borrower deposited into your account. No manual cheque deposits or e-transfers!
B. If for any reason there are delays with payments, a mortgage administrator partner will get in touch with the borrower to help resolve the matter for you and they know the ins and outs of collections and any legalities surrounding the process.
C. Get monthly statements of your mortgage holdings with a detailed break down of any interest and fees you earned. This will come handy at tax season. No more Excel spreadsheets to track what you are earning on your private mortgage investments.
As your private lending team, we sweat the details to serve up only the sweetest deals, hassle-free.
Start your journey: Meet our team and explore possibilities.
Create your lender profile: Share preferences for tailor-made opportunities.
Deal Presentation: Receive hand-picked opportunities aligned with your interests.
A glimpse of the Streetwise track record of empowering real estate investors
Your success is our success. It is as simple as that!
Our blog is the go-to resource for all things private lending! Stay informed and educated on the latest news and developments in this space, and learn how you can benefit from using private money for your next investment.
Investing in private mortgages can provide attractive returns, but it's crucial to understand and mitigate the risks involved. To do...
Private money, within the context of real estate, refers to loans arranged between individual or corporate lenders and individual or...
Stay informed and educated on the latest news and developments in the private lending space.