Understanding the Private Mortgage Option

In many parts of the world one of the biggest aims for most people is to purchase their own property.  In recent years this has become more difficult as the price of property continues to rise and many mortgage lenders are not keen on lending to anyone unless they have a perfect credit record.  The economic issues of 2008 and the slow recovery from this period have made many financial institutes much more wary about lending.

Of course, this does not mean that you cannot borrow funds.  However, the usual criteria apply; these are whether you earn enough, have a good enough credit record and appear to be secure in your job and life.

Unfortunately an increasing number of individuals and couples are struggling to meet these criteria despite being able to afford mortgage repayments.  A good mortgage broker, such as OE Mortgage, will be able to assist you in finding the right product for your needs.

The private Mortgage

In many ways the private mortgage works in the same way as a standard mortgage.  However, instead of your mortgage being delivered via a bank or a traditional mortgage lender; it is issued by a private individual or corporation.  The funds will be deposited with you in the same way as they would via a traditional mortgage and there will be interest to be paid.

The Differences between a Private Mortgage and a Traditional One

The first thing to note is that people or companies who are interested in lending to those who have less than perfect credit, are aware of the additional risks which come with this type of lending.  The consequence of this higher risk is that you mortgage interest rate will generally be higher than with a traditional one.  This will not make it unaffordable but it is worth noting!

The other fundamental difference in obtaining a private mortgage is that the criteria to qualify for the mortgage are generally more relaxed.  The lender is not bound by a mortgage company’s standard terms.  They will be able to assess your application based on the amount you need, your earnings and outgoings, and even your credit history; particularly why you have had problems in the past.  The approach is much more tailored to the individual!


It is not just people who have less than perfect credit which are forced to use private mortgages.  It is also something that can be beneficial to anyone who is self-employed.  Even if you are a very successful entrepreneur you may find it difficult to obtain a traditional mortgage.  However, the private mortgage lenders will see your ability to pay and generally provide you with the necessary funds.  This is in contrast to the traditional lender who is looking for complete employment records and a lack of other debt.

To locate the right private mortgage for your personal situation simply contact the aforementioned broker and go through everything with them.  They should already have links to private mortgage lenders in your area and will assist you in obtaining the mortgage you need.