Mortgage Application Archives - OMJ Mortgage

Commercial Mortgage Broker Tips On An Environmental Assessment

Morteza Sadeghi — Tue, 23 Jul 2024 00:07:27 +0000

OMJ Mortgage Capital is a commercial mortgage broker that can help you find land and development loans. We can get you the best rates and terms, but you must compile some of the following documentation.

Beyond what you’d expect, like proof of identity and government-issued identification, verifying your income with a series of financial statements that go back several years is essential. You’ll also need to put together and document your assets, including investment accounts, bank statements, and any of your other real estate holdings.

Don’t Forget The Land Appraisal

Remember that the land appraisal you’ll need makes one of these purchases unique. A professional needs to do this so you can get the exact amount of the parcel that you want to buy. It’s also essential to help any lender determine the loan-to-value ratio.

A Detailed Description Needs To Be In Order

Don’t forget that an environmental assessment might also be in order. It’s important to include a detailed description of the project here. It needs to have the purpose, any relevant activities that will go on, and the size and location.

The environmental assessment also needs soil and water studies. Local animal sand trees need to be looked at. These assessments need to be thorough. Cutting corners can bog your business ventures down.

Potential impacts air and water pollution angles and their impact on local communities and wildlife should also be studied.

Looking for a Commercial Mortgage Broker?

OMJ Mortgage Capital is a commercial mortgage broker that can help you with this land and development loan aspect. We are a boutique-sized mortgage broker in the GTA with an outstanding track record and decades of experience funding literally billions of loans. Take a look at the clients testimonials on our website. They will show you how easy it is to expand your business using our services.

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Some Tips from a Commercial Mortgage Broker on Investment Properties

Morteza Sadeghi — Mon, 29 Jan 2024 17:20:32 +0000

Here’s why you need a commercial mortgage broker.

Many Canadians consider purchasing an investment property a good option. However, a few things are different from a residential purchase. For example, you’ll need to consider the number of units in any building and decide whether you will occupy any space in them.

These are the two significant factors a commercial mortgage broker can help you with. We can walk you through everything you need to know, including the different types of properties that generate income. Our priority is ensuring you get the best property for your requirements.

The first is a residential investment that an investor could rent out or fix up and resell. Some common ones include townhouses, cottages, apartments, condominiums and single-family homes.
Office buildings and retail stores are commercial properties. Canadian lenders usually consider any building with five or more units a commercial investment.
A building that falls under both of these categories is considered mixed-use. An example is a street-facing retail store with an apartment on the floor above it.

Having a commercial mortgage broker on your side can help you with other decisions, like how much down payment you’ll need. For example, as of 2010, the Canadian requirement is a 20% down payment on non-owner-occupied investment properties.

It’s important to remember that if you put down anything under 20% on one of these investment properties, your maximum amortization will be 25 years. Using a commercial mortgage broker is about leveraging their experience. We can help you with the details. If you put down 20% or more, you can qualify for up to a 35-year amortization period.

Looking for an Excellent Commercial Mortgage Broker You Can Count On?

OMJ Mortgage Capital is a broker with experience. Contact us today to learn more. Getting professional help when making a significant investment is always a good idea. We bring over 75 years of experience to every project that we work on.

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Check These Boxes For The Right Construction Loans

Morteza Sadeghi — Fri, 27 Oct 2023 01:28:50 +0000

You need the cash to finance a project or get a construction loan to cover materials and labour. You can also use one of these loans to purchase the land. These are more involved than conventional mortgage products.

The reason is simple: You’re borrowing money in the short term for a structure that has yet to be built. First, you’ll need to know that construction loans are more difficult to find than traditional mortgage products.

Start by looking at your financial situation carefully.

You may be looking for construction loans to build a unique home. If that’s the case, you must first consider your debt-to-income ratio, credit score, and current income.
The next step is to compare the loan terms and interest rates different lenders offer. Remember to look for any hidden charges or fees. Finding the right lender means looking for flexible terms and competitive rates that align with your financial goals.

Get Approved For Construction Loans

Getting pre-approved and/or pre-qualified is the first step. Before you jump into your plans and start building and buying land or undertake a significant remodelling effort, you’ll need to know how much money you can borrow.

There are some significant differences between construction loans and conventional mortgages, including the maximum amortization period. For example, a construction loan has a one-year maximum amortization, a commercial mortgage has 40 years, and a conventional mortgage usually has 25 years.

How you get the money is also different. For example, the draw schedule typically comes in four segments for a construction loan. A commercial mortgage, on the other hand, comes in one lump sum—the same as a conventional mortgage.

OMG Mortgage is the right company if you’re looking for construction loans. We have a combined experience level of over 75 years in the industry. The team here has industry experience as commercial bankers at Canadian financial institutions. That’s part of the edge we offer you, along with knowing the best way to package a deal.

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Use This Commercial Construction Loan Checklist To Get Approved.

Morteza Sadeghi — Mon, 21 Aug 2023 19:35:58 +0000

Getting a commercial construction loan at the right time can be a difference-maker for your company. Our best clients are the people who are well-informed. That’s why we’ve put together this checklist that will help you get approved.

Don’t forget about your personal credit score. It’s important to keep in mind that when you’re looking for a construction or business loan a personal credit score plays a large part. Showing that you’re responsible with your money makes a difference. Don’t worry about having this documentation on hand. A lender can get some information through Equifax credit reports.
You need to put together some information about the project itself. Any lender will want to know what company is doing the building and how their related qualifications fit in. For example, an application should detail whether a general contractor or turnkey builder will be used.
Permits, drawings, and plans are an important part of a commercial construction loan checklist. These need to detail how everything is going to be built. Plus they should also provide a view on how things will look when they are done. Not everything needs to be finalized for the application to be considered. However, they’ll be no money advanced or dispersed without all the approvals in place.
It’s important to provide a budget although it doesn’t need to be extremely detailed at this stage. However, the more detail you include here the more credibility you’ll get with any lender.

Why not take a few minutes to check out our commercial product guide when you’re looking at putting together information for a commercial construction loan? Then get in touch with us so we can start the process for you. Leveraging our decades of banking experience and years in the mortgage industry starts when you contact our office.

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Tips for Accessing The Risk With Commercial Mortgages in Toronto.

Morteza Sadeghi — Mon, 10 Jul 2023 14:32:22 +0000

Before you dive right in with commercial mortgages in Toronto, it’s a good idea to assess the risk of the real estate class you’re considering.

Risk and returns can vary considerably. Healthcare assets can be less prone to economic cycles. Other commercial assets like hotels can be vulnerable to room rates and occupancy changes. Regardless of the type, every commercial real estate investment has some risk.

Any commercial real estate (CRE) market is cyclical and subject to overarching general economic trends. A variety of factors ranging from GDP growth to inflation can influence a CRE market and the risk involved. For example, an inflationary surge can bump up operational costs while diminishing returns on leases that have already been signed. Businesses holding commercial mortgages in Toronto need to be wary of floating interest rates as well.
Property risk is another consideration. These are usually under the direct influence of whoever’s investing in the asset. Due diligence comes into play. For example, there are improvement and replacement risks related to the construction needed to repair, upgrade or develop a building. These factors become even more important when you’re making an assessment of an older property in a high-demand area. Older buildings can become obsolete much faster under these conditions.

OMJ Mortage Capital looks after a variety of different mortgage brokerage needs including commercial mortgages in Toronto. Our specialties include construction, land, and commercial mortgages through the GTA. We have an outstanding track record of funding billions of dollars in loans and have fully established ourselves as a leader among brokerages. We look forward to working with you and helping you reach your individual goals and overcome any unique challenges you have when investing in commercial property. Please take a moment to look through the different awards on our website and then get in touch with us today.

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Why A Cash Flow Analysis Is Necessary for Commercial Financing

Morteza Sadeghi — Thu, 29 Jun 2023 14:56:31 +0000

Looking for commercial financing? A cash flow analysis allows you and the lender to see how money is moving in and out of your business. The first step in getting one of these right is identifying all the income that comes into your business. Tally up all the numbers that you have in a specific period of time including the money generated from assets that are sold and investments as well as revenue from goods sold and services rendered.

When you’re looking for commercial financing, all the lenders want to mitigate their risk. A cash flow analysis helps to show that a business has enough money flowing through it to make regular loan payments.

All The Different Business Expenses

The second stage needs to highlight all the different business expenses like accounts payable, inventory purchases or any other liabilities you have on your books. Keep these limited to a certain point in time but include depreciation on fixed assets.

A good cash flow statement also shows a lending institution that your business can come up with working capital when need be. Showing a lender that you can stay solvent and make supplier payments and have working capital for inventory management is important.

Putting This Commercial Financing Data To Work

The third step in creating one of these statements is to put the information to work. Generally, one of these reports has three different sections reflecting financing arrangements, company investments, and operating income expenses.

The best case scenario is when a business can see a positive cash flow coming out of its operating activities. However, there is a balancing act because they also want to be able to make strategic purchases and investments to scale their operation.

OMG mortgage capital specializes in commercial financing and helping you to get construction loans.

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Construction Loans and Draw Schedules: An Overview

Morteza Sadeghi — Fri, 23 Jun 2023 14:44:35 +0000

A draw schedule includes the payment plans for your construction loans and how you’ll get the money as the project progresses. The goal is to make payments to the contractor as the work goes on.

The schedules are generally proposed by the contractor and negotiated by the lender. Some financial institutions have standardized schedules. Bank’s appraisers make sure these are reasonably based on a general knowledge of the whole process.

Construction Loans For Projects

Banks will generally distribute the money for projects in several different payments as the work goes along. For new homes, a typical draw schedule will have up to seven installments. However, some institutions might distribute the money as frequently as weekly.

Here are a few milestones to give you an idea of how one of these works.

The first draw for a custom home or in addition usually coincides with the foundation. Plans and specifications are needed.
The second draw generally coincides with rough framing. By the fifth draw interior trim, cabinets, and interior doors as well as flooring are done.
Draw six is sometimes called the substantial completion draw. It generally covers the completion of different hookups like those for water and sewer. The electrical work and the plumbing is finished at this stage.
The substantial completion draw is the last one. The amounts vary depending on the institution you’re working with

Here are a few other considerations for construction loans and the draws that come with them. Some builders prefer to frontload the payments. That acts as a buffer in case they don’t get paid for any reason and works to improve their cash flow at the same time.

OMG Mortgage Capital specializes in construction loans and other types of commercial financing. Get in touch with us today to learn more about draws and other issues that affect commercial mortgages and other types of financing.

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Looking for Construction Land Loans? Here’s a Mortgage Financing Checklist

Morteza Sadeghi — Tue, 21 Feb 2023 20:44:48 +0000

Maybe you’re looking for construction land loans to develop a small acreage or piece of vacant land with the hopes of building a new commercial building. Here’s a quick financing guide from your Toronto mortgage broker that will help to get the project started.

There are generally four steps that you need to take to get the right financing.

It’s important to realize that you’re going to need a bigger down payment. This amount can be as much as seven times the minimum down payment needed to buy a residential home. Lenders generally call this a cash requirement. It’s also important to remember you won’t get all the money in a lump sum. You’ll need to set up some progress milestones to get cash released.
There is also a property requirement. It stands to reason that before you get the loan, you’ll need to meet the requirements set out by the lender.
The experience requirement is another aspect that you need to consider for construction loans. These are guarantees that any project you take on will be done on budget and on time.
The most important tip comes last. It’s important that you can show your company’s profitability. That means it’s imperative that you keep your company’s finances in order.

When you’re looking for construction land loans and you’ve found the right property, you need to put together the documents to show the lender. Up-to-date financial statements are critical. You’ll also need a solid business plan.

These need to have an excellent description of your enterprise and where it is in relation to the marketplace. Don’t forget these documents also need to include an excellent sales and marketing plan and strategy to target their customers.

A solid business plan also needs to have an executive summary. This is a final review of your business operations and the reasons why you are looking for construction land loans financing.

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Your Mortgage Broker in Toronto Answers The Question: Why Are Mortgage Rates Going Up?

Morteza Sadeghi — Tue, 08 Nov 2022 15:34:00 +0000

The Bank of Canada has been raising mortgage rates all year long. As your mortgage broker in Toronto specialists, we want you to have the right information to make a good choice.

That’s why we’ve taken the time to answer the question of why mortgage rates are going up.

First off, one of these contributors is inflation. Groceries are going up at the fastest rate in decades. Even though gas prices fell recently, food is increasing. Consider that the cost of getting groceries is up 11.4% over last year.

House prices skyrocketed during the pandemic. That’s another factor. Those same prices are now dropping as the borrowing costs go up. Here’s another important factor we take into account as a mortgage broker in Toronto.

The Bank of Canada sets the policy interest rate. That affects the numbers that Canadian banks set for mortgages. Overall, the low mortgage rates of the last few years are a thing of the past.

House prices are dropping across the country. Unfortunately at the same time, homeowners might have more problems qualifying for mortgages.

During these volatile times, it’s important to assess mortgages based on rates that are even higher than the ones offered. That helps buyers have a cushion because they have already been verified for a higher rate.

Buyers should remember there’s a difference between a fixed rate and a variable rate mortgage. For the fixed-rate variety, the payments will stay the same until it gets renewed. The payment amount is fixed for variable rate mortgages well. However, there will be more interest which means buyers will pay off less principal. We’re the Toronto mortgage broker that can help get the rates and terms best for you.

Recently, the Bank of Canada increased its interest rate to 4.25%. That’s the highest it’s been since 2008.

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Here’s a Preapplication Mortgage Broker Toronto Checklist

Morteza Sadeghi — Tue, 27 Sep 2022 19:18:00 +0000

As your mortgage broker in Toronto specialist, we are here to help. Maybe you’re getting ready to break into the market for the first time. Or maybe you’re looking for that next home as your family grows.

Getting the best mortgage rates for you is our business. And giving you a checklist to get things in order before you apply. Following is some of what you’ll need.

If you’re an employee, it’s a good idea to get a letter of employment that’s dated within the last two months. Make sure to include your most recent T4 slip. You will also need to include a pay stub that’s dated within the last 30 days.
If you can get your most recent bank statements together, that will help with the application process. Try to get ones that cover the last six months. If that’s not possible, three months will do.
Got a pre-approval letter? You should include that with your mortgage application.
If you’re buying a new property and selling off your existing one, a copy of the Agreement of Purchase and Sale is important. Especially if you’re going to use the one you’re selling as a down payment.
Someone like a family member might be helping you with the down payment. If that’s the case, the lending institution will more likely need a gift letter. It will need to confirm that the money does not need to be repaid.

That’s just some of the information you’ll need to get together. At OMJ Mortgage Capital we are happy to walk you through the entire process. What’s more, our team of ex banking executives is dedicated to getting you the best mortgage rates. We are the mortgage broker in Toronto with experience and compassion.

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