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PRIVATE MORTGAGE LOANS

Private Mortgages

Private mortgages are similar to what a Bank would use as a means of security for lending you funds. Unlike a Bank the funds are provided by private individuals from their personal funds, but the process is the same.

You will complete an application form and provide the necessary information for the Lender to make a decision on whether they want to participate or not. This will be based on a few things, the amount of the loan, the location of the property you are offering as security for the loan, and the circumstances surrounding the use of funds which must be for investment or business purposes.

Loan amounts are generally in the range of $200,000 to $1,000,000 with a term of twelve months and the opportunity for the Lender to offer you and extension. Some Lenders will also allow variances to the original loan amount depending upon the circumstances.

Once the loan application is processed and approved, we will issue a Letter of Offer setting out the terms and conditions surrounding the loan funding. If you agree to the terms you will need to sign, date, and return the letter to progress your application.

You will need to appoint a Lawyer to manage the signing and lodging of the mortgage documents and to provide you with advice on taking up the loan.

Once documents are returned, the Lenders Lawyer will arrange for the funds to be deposited into his Trust account ready for settlement, arrange settlement, and effect settlement on an agreed date.

It is your responsibility to ensure that your funds are used for the specific purpose of the loan and to manage all repayments which must reach the Lender before the due date to secure the discounted interest and repayment amount.

When the loan matures or you want to repay the loan, subject to the terms of our agreement, you will need to notify us of this intent and make arrangements for the mortgage to be released. The Lenders Lawyer will arrange to attend settlement to hand over the mortgage document.

These loans are “interest only loans”, meaning you only repay the interest amount for the use of the funds, the capital amount, the original amount of the loan is not reduced, and is repaid in full at the end of the loan term. Arrangements can be made for the reduction of the principal amount at any time during the loan term, subject to approval by the Lender

The Borrowers are required to provide a current valuation on the property provided by a Licensed Valuer and on occasions, a site inspection is required, which is paid for by the Borrower.