Читать книгу Complete Home Buyer's Guide For Canada - Geraldine Santiago - Страница 9

A vendor take-back (VTB) mortgage allows you a chance to purchase a property with the help of vendors who lend you a portion of the purchase price. Such a loan often comes with favourable or flexible terms, depending on the inclinations of the individual vendor. The loan may be open, which means that you can repay it any time without penalty. The vendor may charge an interest rate lower than the prevailing market rate, or the vendor may negotiate the term of the loan with you.

You can avoid a lot of red tape and administrative charges by obtaining a VTB mortgage. In a slow market, a VTB mortgage attracts potential buyers. On the other hand, if the market is hot, you won’t find many vendors who’ll offer to lend you money at favourable rates, unless their property is poorly located, in bad condition, or otherwise hard to sell. In general, vendors sometimes prefer the steady and consistent return of a mortgage secured by a familiar property to a riskier investment. They also prefer borrowers such as you, whom they know and trust, to faceless and nameless managers who manage many other types of investments.