Perhaps you’re like many Canadians who misunderstand the second – or third – mortgage market. Maybe you yourself have never had a second mortgage and therefore think borrowers who use them must be on the path to insolvency; and that they’re taking the final steps before going upside down. The truth is that there are numerous scenarios where quality borrowers are in need of short term money while their financial health is very good.
We will try and share a few of the stories of deals we have been a part of here at AltaPacific Mortgages through our Canadian mortgage blog. We hope that our investors – and potential investors – will better understand how investing with AltaPacific MIC is a great way to diversify their portfolio of RSP investments or private placement funds.
A deal recently executed by AltaPacific was actually on a first mortgage (we’ll talk about some second mortgage examples in a future post). It’s like a second mortgage in nature though as it is short term at attractive rates. The property is a multi unit complex with clear title (meaning 100% paid for – no current mortgage on the property). The owner is a developer/contractor and is performing renovation updates to the property (some units completed and sale ready; others under renovation) and plans to sell the units in the highly desirable resort community (in Western Canada). An independent appraisal in September 2008 appraised the property “as is” for approximately $8 million dollars. The “if completed as described” appraised value is approximately $11 million dollars. The owner needed short term money to pay some immediate bills outstanding and his full first mortgage is not scheduled to be closed until the end of January 2009. He needed money within days. AltaPacific discoverd the opportunity through our network of mortgage originators and reached out to help him, the contractor/owner/developer. We structured a deal in a very short amount of time and he received approximately $250,000; allowing him to satisfy his short term needs. The deal was done with low-teen interest rates and a fair upfront fee over a 6 month term. The borrower’s credit, past experience, credibility and ability to pay back the loan all fell within the guidelines of AltaPacific MIC’s
Details described on AltaPacific’s Canadian mortgage blog are not fully disclosed in order to keep actual parties and details anonymous. Please feel free to contact us if you’d like to learn more about AltaPacific mortgage guidelines or actual mortgage details of deals we’re involved with. Our mortgage originators are some of the highest volume mortgage brokers in Canada – we think you’ll be very impressed with our access to high quality mortgage opportunities.
