Flexible Solutions for Bridge Loans

How Private Lending Provides Flexible Solutions

Today, we’re diving into a bridge financing deal that showcases the flexibility of private lending. In this example, a client was purchasing a unique property—a lakefront mini home on a foundation—while preparing to sell their current free-and-clear home in Lower Sackville, Nova Scotia.

Deal Overview

The client was purchasing an owner-occupied, well-maintained mini home on its own lakefront land within HRM. Typically, mini homes fall outside our lending criteria, but this case was an exception due to the prime location and the additional security offered by the client’s existing property within Halifax Regional Municipality (HRM). The clients needed to close on the lakefront home first, intending to list and sell their current property shortly after.

Financing Structure

We secured both properties to make this deal work:

• A chattel mortgage was placed on the mini home itself.

• A first mortgage was registered on the land the mini home occupies.

• We also secured the client’s Lower Sackville home in the first position as additional security. In a different scenario where the existing property was already mortgaged, we would have placed a second mortgage instead.

Client Profile

The borrowers were self-employed with strong income streams to support their payments. While one borrower had some past credit challenges, they had since rebuilt their credit with no repayment issues. The second borrower had no significant credit problems aside from an over-limit trade, maintaining a credit score above 700. Both borrowers had solid financial profiles, and we were confident they could manage the loan until the sale of their Lower Sackville property.

Additionally, they had sufficient cash flow and savings to cover interest payments on the bridge loan, further reinforcing our confidence in the deal.

Flexibility of Private Lending

This deal illustrates the flexibility private lenders can offer through a tailored financing solution. The client was able to secure their lakefront home while listing their current property on their terms.

Private lending’s case-by-case assessment approach allows us to offer solutions that traditional lenders often cannot. This adaptability makes private lending a powerful option for clients with unique, short-term financing needs.