15 Feb 2022

What Is a Non-Bank Loan?

Non-Bank Loan Details

A loan issued by a non-bank lender does not differ in its components from a loan issued by a banking institution, credit union, or lending society. However, a non-bank loan can offer more competitive terms than banks. 

Loans from non-banks have a principal and interest rate. The principal is the amount that the home buyer needs to buy the property based on its value. Some homebuyers qualify for 100% financing or a 100% loan-to-value ratio. Others place a 20% deposit. Therefore, they only require the remaining 80%. Some home buyers only qualify for 60% financing. Those who provide a guarantor can receive up to 110%.

All mortgages have upfront fees attached to them. For example, lenders charge a fee to start the application process. These fees cover the administrative work that takes place behind the scenes. Mortgage House offers a no-fee mortgage for those interested.

Where banks and non-bank lenders diverge is in their terms. Non-bank lenders such as Mortgage House can provide competitive rates to well-qualified homebuyers. We can match the terms offered by banks. Plus, we offer loan terms to individuals who do not qualify for a conventional mortgage. 

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Non-Bank Loan Details Conclusion

A non-bank loan doesn’t have structural differences from those issued by a bank. Instead, they offer more competitive terms in many cases. To gather more information, speak with our Mortgage House loan specialists. They remain ready to help.

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