Alternative Lending
Getting you the mortgage you deserve
When the Bank Says No, You May Still Have Options.
Being turned down by a traditional bank doesn't necessarily mean you can't get a mortgage.
At Mortgage Broker Okotoks, I specialize in looking beyond the standard lending box. Alternative mortgage lending can provide solutions for borrowers who have strong overall applications but don't fit the strict guidelines of a traditional bank or prime lender.
Whether you're self-employed, rebuilding your credit, carrying higher debt, purchasing a unique property, or simply don't qualify under traditional lending guidelines, there may be another solution.
What Is Alternative Lending?
Alternative lending—often referred to as Alt-A or B lending—provides mortgage options outside traditional prime lending guidelines.
These lenders may take a more flexible approach when reviewing your application. Instead of looking only at your credit score or whether your income fits into a standard formula, they may consider the bigger picture, including your income, equity, down payment, property, credit history and overall financial situation.
The result is more flexibility for borrowers whose circumstances don't fit neatly into the traditional lending box.
Who Can Alternative Lending Help?
Alternative lending may be worth exploring when your financial situation doesn't fit neatly within traditional lending guidelines.
- Self-employed or a business owner and your tax returns don't reflect your true cash flow
- Commission-based or have variable income
- Newly employed or recently changed careers
- Rebuilding your credit after previous financial challenges
- Recently discharged from a consumer proposal or bankruptcy
- Carrying higher debt levels than traditional lenders allow
- Looking to consolidate high-interest debt
- Purchasing a property that doesn't meet traditional lender guidelines
- A real estate investor with multiple properties
- Looking for a solution where a traditional bank has already declined your application
Every situation is different. A decline from one lender doesn't automatically mean every lender will give you the same answer.
Self-Employed? Your Income May Tell a Different Story.
One of the biggest challenges for self-employed Canadians is proving income in the way traditional lenders require.
Business owners often legitimately reduce their taxable income through business expenses and deductions. While that can make sense from a tax perspective, it can sometimes make qualifying for a traditional mortgage more difficult.
Certain alternative lenders have programs specifically designed for self-employed borrowers and may consider additional ways of demonstrating the strength and cash flow of your business.
Instead of simply asking:
“What does your tax return say?”
I want to understand:
“What is the full financial story?”
Credit Challenges Don't Have to Define Your Future
Life happens.
Job loss, divorce or separation, illness, missed payments, collections, a consumer proposal or other unexpected circumstances can affect otherwise responsible borrowers.
Alternative lenders may be more flexible when there is a reasonable explanation for previous credit problems and evidence that your financial situation has improved.
I look at what happened, why it happened, what's changed, and what the plan is going forward.
Alternative Lending Can Be a Strategy — Not a Destination
In many situations, an alternative mortgage can be used as a short-term stepping stone.
The strategy may be to obtain the financing you need today while creating a plan to improve your overall financial position.
Alternative Mortgage → Improve Credit → Reduce Debt → Establish Income → Build Equity → Return to Prime Lending
Where appropriate, I'll help you understand what needs to happen during the mortgage term so you may be in a stronger position when it's time to renew or refinance.
What Does Alternative Lending Cost?
Alternative mortgages will generally have higher interest rates and potentially additional lender and/or broker fees compared with traditional prime mortgages.
The exact cost depends on several factors, including:
- Credit history
- Income and income verification
- Property type and location
- Loan-to-value
- Available equity or down payment
- Mortgage amount
- Overall strength of the application
Before proceeding, I'll explain the proposed mortgage structure, applicable costs and available options so you can make an informed decision.
You've Been Declined. What's Next?
Don't assume that one bank's answer is the final answer.
As a mortgage broker, I have access to a range of lending options, including prime lenders, alternative lenders and private mortgage lenders.
With more than 17 years of mortgage industry experience and a background in banking, lending and underwriting, I understand how to structure challenging applications and present the complete story behind the numbers.
Sometimes the solution isn't about finding the lowest advertised rate.
It's about finding the right lender, the right structure and the right path forward.
Let's Find Out What's Possible
If your bank has declined you, you're self-employed, your credit isn't perfect, or your situation simply doesn't fit traditional lending guidelines, let's have a conversation.
Your situation may be more workable than you think.
THINK OUTSIDE OF THE BOX.
Ken Faminoff
Senior Mortgage Broker
Value Mortgage Solutions | Mortgage Architects – Team Borle
Serving Calgary, Okotoks and clients throughout Alberta
