Private Lender

Importance: 0.57

Is a company: no

Is a proper noun: no

Synonyms

  • private medical treatment
  • non-standard lender
  • private financing
  • private treatment
  • non-traditional lender
  • private financer

Alternate Spellings

  • private financing

Definition of Private Lender

  1. A lender who is not affiliated with a bank or traditional lender, and who may or may not normally be in the business of providing loans. Private lenders are not as constrained by regulations as traditional lenders are and can approve ventures that traditional lenders cannot. Private lenders and financiers often charge higher interest rates and fees than traditional lenders due to the higher level of risk they expose themselves to. Also known as "private financing."

Related Terms and Acronyms

  • Pre-approval Definition,
    • A process that mortgage lenders use to determine how much money they would lend you based on a thorough review of your financial situation. Lenders issue a pre-approval letter which strengthens your position when bidding on a home, as it shows sellers that you will be able to raise funds needed to purchase.
  • Creative Financing Definition,
    • An innovative or unusual way of structuring a home loan that allows the buyer to buy the house.
  • Sub-prime Mortgage Definition, Important,
    • A mortgage loan that is granted to a borrower who is considered sub-prime (has a less-than-perfect credit report). Sub-prime borrowers have either missed payments on a debt or have made late payments. Lenders charge a higher interest rate to compensate for potential losses from customers who may default on the loan.
  • Shared-Appreciation Mortgage (SAM) Acronym,
    • A home loan in which the lender offers a below-market interest rate in exchange for sharing in the profit when the home is sold. Usually done only with private funds/lenders.
    • A mortgage loan where the lender or a third-party backer agrees to offer a highly reduced mortgage rate to the borrower in exchange of sharing profits when the property is sold.
  • No Money Down Mortgage Definition, Important,
    • Available in Canada as a true 100% mortgage financing product.
  • No-documentation Loan Definition,
    • A mortgage in which the applicant provides a minimum of information -- name, address, Social Insurance number (so credit reports can be pulled), and contact information for an employer, if there is one. The underwriter decides on the loan based on the applicant's credit history, the appraised value of the house and size of down payment.
  • Mortgage Rate Definition, Very Important,
    • The interest rate on a mortgage loan.
    You can compare mortgage rates using this website by clicking 'Rates' above.
  • Low-documentation Loan Definition,
    • A mortgage that requires less income or asset verification than conventional loans. Low-documentation loans are designed for the entrepreneur or self-employed, for recent immigrants, or for borrowers who cannot or choose not to reveal their financial information. A substantial down payment and excellent credit history are generally required. This type of loan will also yield a higher interest rate.
  • Mortgagee Definition, Important,
    • The lender in a mortgage transaction.
  • Mortgage Broker (MB) Acronym, Important,
    • One who finds clients perspective lenders at generally no cost. Mortgage Brokers have a special relationship with lenders and can offer their clients the best rates and service. CanEquity goes through great lengths to ensure you are serviced by the best Mortgage Brokers in Canada.
  • Prime Lending Rate (PLR) Acronym, Very Important,
    • The rate of interest charged on loans by chartered banks to their most creditworthy customers.
    Bank of Canada's prime (best) lending rate.
  • Loan Definition,
    • Letting another party use something of value temporarily.
  • Interest Rate (IR) Acronym, Very Important,
    • The rate a lender charges an individual to borrow money.
  • Lender Definition,
    • The bank or mortgage company offering the loan.
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