Land mortgage are used to purchase a plot of land. The type of loan you get is determined by where you buy the land and how you want to use it. Unzoned land mortgages, rezoned land mortgages, and construction land mortgages are the three most common types of land mortgages in Canada.
These mortgages can also be acquired to purchase or refinance land parcels. Land mortgages in Canada are very beneficial and can be used to purchase new lots, refinance land parcels for servicing and/or development activities, and property construction.
If you are looking for a vacant Land Mortgage Canada, here is everything you need to know to get started.
Application Process For Vacant Land Mortgage in Canada
Getting approved for a land mortgage could be the most important step in the land buying process. Usually, borrowers opt for pre-approval because it can be extremely beneficial. It is not only financially and mentally reassuring but is also a factor that convinces lenders to establish a mortgage catering to your needs.
Lenders are more likely to demand interest rates, down payments, and monthly instalments that meet your criteria if you have been pre-approved. However, if you weren’t already pre-approved, you will have to follow a standard approval process.
The vacant land mortgage approval procedure in Canada is similar to the mortgage pre-approval: you will need to provide detailed information about the land you are purchasing, along with your income and down payment details.
Lenders require specific documentation in order to approve a land mortgage. To ensure you can repay the land mortgage, lenders require proof of employment and/or other sources of income such as investments, rental income, or freelance income.
They also ask for proof that your down payment was not lent to you. This can be confirmed with a savings or investment statement, proof of RRSP withdrawal, or a letter saying the money is not a loan from a loved one, depending on where the money is coming from.
An inventory of your current assets and liabilities such as investments or car loans and void cheque to set up mortgage payment withdrawals might also be requested.
Once your mortgage broker or lender has all of these details, they’ll send the application to an underwriter at the financial institution providing you with a land mortgage. The lender will use debt service ratios to determine if your application fits within their guidelines. If the lender is satisfied that both your finances and the property fit within their qualifying guidelines, they’ll approve you for the mortgage.
All of these requirements, including documentation and evaluations, are in place to reduce the risk for both the lender and the borrower. However, at the end of the day, your land mortgage loan’s requirements and conditions depend on your lender.
To ensure you get the mortgage you need, it is important to choose a beneficial lender. If you are looking for a reliable financial provider with a quick application process and ideal mortgage terms, Freedom Capital should be your go-to.
Freedom Capital’s Unique Land Mortgages
Whether you are planning to purchase raw land, intending to improve your property’s geographic landscape or are simply looking to purchase a new farm, Freedom Capital can help you get the land mortgage or the investment property mortgage you need.
At Freedom Capital, we cater to emergency land mortgages and provide fast and easy access to money that immediately solves your problems pertaining to the acquisition of land mortgages.
Freedom Capital is where you can expect to begin your debt-free and stress-free journey. Our conditions of payment are basic and easy to understand, especially for individuals with little or no knowledge of how to obtain financing. Our transparent and easy application approval process bears testimony to the fact that we provide our customers with one of the best land financing packages and land mortgages in Canada.
Unlike other private land financing firms, we don’t exploit our customers with hidden fees or costs. At Freedom Capital, our core focus is centered on an approach to providing ease and comfort to our customers looking to stay out of financial trouble.
We make quick lending arrangements from our extensive network of lenders to fund land mortgages in Canada immediately, which is what makes us stand out amongst the array of lenders in Canada.