An inter alia mortgage is secured by more than one property. A single financing agreement is registered against each property that is used as security. This type of loan is sometimes called a blanket mortgage.
There are many reasons why you may choose an inter alia mortgage, but the number one reason is to provide additional security for a lender. Sometimes lenders may not accept the subject property for which you are seeking financing on its own, and they may look to you as the borrower to provide additional security in the form of another property you already own.
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Is an Inter Alia Mortgage Right for Me?
Inter alia mortgage financing is not common in Canada, but there are several situations in which it can be the best solution for you.
- You are purchasing a home, but your current property hasn’t yet sold. There are times that the sale of your existing home doesn’t line up with the purchase of your next one. In those cases, if your property is mortgage-free or has a low loan to value, an inter alia mortgage may give you the ability to leverage the equity you’ve built. Sometimes this situation is referred to as bridge financing.
- Your additional property will strengthen your file with a private lender. Private financing may be the only option available to you if you show limited income, have poor credit, or the property you are purchasing does not meet conventional lending criteria. In order to build a stronger file and secure a more favorable rate, it may make sense to include your other real estate assets.
- You are building a real estate portfolio. If you own one or more properties without a mortgage and are looking to buy additional properties, it may make sense to leverage your existing equity with an inter alia mortgage. The additional security is particularly important if you are buying a “fixer-upper” property that a lender may not approve on its own. You may also look at inter alia financing if you are purchasing multiple properties at the same time.
Will an Inter Alia Mortgage Prevent Me from Selling a Property in the Future?
If your plan is to sell one of the properties that is being used for an inter alia mortgage, it’s important to be clear about your intentions up front. Just like any other mortgage, you may face a penalty if you need to break your term early. With full information, our team can help find the right mortgage product and make sure you’re aware of any risks.
How Can Auxilium Help Me with My Inter Alia Financing?
As with any other financial decision, there are pros and cons for choosing an inter alia mortgage, all of which should be reviewed thoroughly before making any final decisions. The Auxilium Team approaches your mortgage financing in a way that looks at all your options and lays out each scenario for you to consider. At the end of the day, you decide whether inter alia mortgage financing is right for your situation.
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