DOCUMENT CHECKLIST

Private and alternative lending

Less about the income, more about the property and the way out.

All checklists

For files that do not fit at an A lender: bruised credit, unprovable income, a property with a story, or a short term need. B lenders still underwrite income, usually from bank statements. Private lenders underwrite the property and the exit. Both require additional disclosure to the borrower in every province, so complete the regulator's forms before submission.

The property

  • Purchase agreement or current mortgage statement
  • Full appraisal from an approved appraiser, ordered early because private lenders lend on it
  • Property tax bill and confirmation taxes are current
  • Insurance binder naming the lender
  • Strata documents, or an environmental report on anything that is not a house

The borrower

  • Credit bureau with a written explanation of every derogatory item
  • Twelve months of bank statements, personal and business
  • Whatever income proof exists: NOAs, pay stubs, invoices, contracts
  • Two pieces of government identification and a void cheque

The exit

  • A written exit strategy: sale, refinance to an A or B lender at a date, or another repayment source
  • Evidence supporting the exit: listing agreement, improving credit, a maturing investment, a pending sale
  • Client acknowledgement of the term, rate, fees and renewal cost

Disclosure

  • Provincial disclosure forms for a private or high cost mortgage, completed and signed the required number of days before funding
  • Lender fee, broker fee and legal fee disclosure
  • Independent legal advice arranged for the borrower where required

What stalls this file

An exit strategy that is a hope rather than a plan. If the client cannot say how the private mortgage ends, the underwriter will not fund it. Our Deal Desk structures these files with you.

Want a brokerage that processes the file for you?

At A.I.M.I. Collective deal processing and compliance are handled at head office. Book a call to see how a file runs here.

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