Private Mortgage - Exit Strategy

Having a good exit strategy is crucial for anyone taking out a private mortgage, as it can help ensure that you are able to repay the loan and avoid default or financial distress. An exit strategy is a plan for how you will pay off your mortgage and ultimately "exit" the loan, whether that means selling the property, refinancing, or some other method of repayment.

Here are a few reasons why a good exit strategy is important for private mortgages:

Private mortgages typically have shorter terms: Private mortgages are often shorter in term than traditional mortgages, which means that you will need to pay off the loan within a shorter time frame. A good exit strategy can help you plan for how you will pay off the loan and avoid default.

Interest only payments: Most private mortgages are interest only payments which does not pay down any of the principal over time. A good exit strategy lays out how you will repay this loan.

Higher interest rates: Private mortgages often have higher interest rates than traditional mortgages, which can make them more expensive to repay. A good exit strategy can help you plan for how you will pay off the loan and manage your debt.

Potential for property appreciation: Depending on the market, your property may appreciate in value over time, which can provide an opportunity to refinance or sell the property to pay off the mortgage. A good exit strategy can help you take advantage of these opportunities and pay off your loan.

Overall, having a good exit strategy is crucial for anyone taking out a private mortgage. It can help you manage your debt and ensure that you are able to repay the loan and avoid default. It is important to carefully consider your exit strategy and to work with an experienced mortgage broker to ensure that your private mortgage is the right fit for your financial needs.

Contact Us

For more information on private mortgages, contact your local Ajax Mortgage Broker, Sean Stewart at 905-427-9596 or sean@seanastewart.com