Mississauga Land financing can be secured for just about any type of property provided that the risks of ownership are not anything that would dissuade a mortgage lender, such as a known environmental risk.
Even in situations where some level of known environmental contamination exists, there still are some private mortgage lenders that may fund the deal, but obviously for a higher cost of financing.
In most cases where the applicant is trying to finance bare land, land mortgage financing is capped at 50% of the current market value. This may increase slightly if the property is in an actively traded market area for similar sites or on the edge of development that is growing outward and that will absorb neighboring property in the near future.
For developed land, the loan to value ratio can be higher, once again depending on the expected future market value and the ability for the lender to be able quickly resale in the market in situations of mortgage default where a mortgage lender would have to realize against their security.
Even bare land properties can get bank mortgage financing if the borrower has a strong enough credit profile and proof of debt serving ability. In the end, real estate is always going to be a preferred financing method, so any land with market value is a potential source of financing for an individual or business.
Land loans can be used for a number of different purposes including development costs for the property itself, equity financing to provide capital for acquisition financing for another property, collateral security to provide greater security comfort for an equipment or inventory loan, bridge financing to provide a quick source of capital for a number of other applications, and so on.
Private mortgage land loans are typically going to be for one year so it will be important to show the lender an exit strategy to retire the mortgage at the end of the one year term. Terms of greater than one year can be arranged as well, but there may be additional costs to consider such as a renewal fee after the first year.
If you require a Mississauga land mortgage, I suggest that you give me a call so I can quickly go over your requirements, and provide land mortgage financing options that meet your needs.