Creative methods for a third mortgage in Canada?

Question

Hello Everyone! I've been a home owner and landlord for the past 5 years. I've always wanted to "Get into" real estate, but didn't know how until about a year ago. I've been doing lots of research but I'm not in a position to buy another house.

I've been reading lots, and trying to to change my mind set regarding life in general. I've been starting to think, "how can I?" Rather than "I can't." well as soon as I did, my father in law has decided to go in and purchase my grandparents house with me. I'm using equity, he's using cash. I'll give him 10% annual return, and refinance after a set amount of years to pay him off. It's a nice, cash flowing property that'll come with 30k equity, and up to 80k if I reno it all up nice.

Great news for me! 3 months ago I wouldn't have seen this coming and I'm still a little surprised to be honest. But now, I'm looking at how do I get another? Well money isn't common in my family, everyone I know has no faith in real estate and is content being mediocre for the rest of their lives. The banks consider me maxed out due to my income vs debt ratio.

How would you guys recommend me looking into a third mortgage? I've been sending every private seller in my town an email inquiring about vendor financing. I'm waiting for a multifamily deal to come available in a nice part of town to ask a bank for 100% funding, as I don't think they would for the current apartments for sale.

Thank you in advance, any information or guidance is highly appreciated!

Theresa Harris · Answer

Talk to your lender about other types of loans.  If you are maxed out on your debt to income ratio, I doubt you'd be able to get another regular mortgage and definitely not for 100% of the purchase amount.  You could try partnering with someone else.

Huong Luu · Answer

@Kenny Clark Every investor at some point is told they don't quality for a mortgage the traditional way either due to money or door restriction. The things you can consider is

1. partnering with someone with money who can quality for the mortgage. So you set up a joint venture and at some point you buy them out.

2. get the seller to hold the mortgage for you.

3. look into private lending

4. see if you have more family who will lend you money

There are other creative ways. Don't hesitate to message me separately. Good luck.

Kenny Clark · Answer

@Huong Luu Thanks Huong for the quick overview. I'd love to connect and chat sometime! I don't come from a place of money so I'm trying to find all the different options available to me. I'm not necessarily in a spot to buy now, but in a few more months I'd like to start looking again.