Private Mortgage

For clients who don’t fit traditional lending guidelines, we provide access to trusted private lenders, B-lenders, and alternative mortgage solutions.

Canada’s mortgage market is developed around strict rules and a lot of capable homeowners usually fall outside them. Self employed owners and people rebuilding credit along with buyers facing a tight closing date and property owners who are required to fund an opportunity quickly can all find that a bank says no. Private mortgage lenders in Canada fills the gap and getting to know how they work would help you borrow with confidence instead of urgency.

At Everlend, we assist homeowners and investors in Ontario and beyond to understand these choices and find a lender that suits their situation. Here at Everlend you will get to know what is best for you and what you can expect on cost and structure along with knowing the steps to prepare so your file is strong from the first conversation.

What Are Private Mortgage Lenders?

Private mortgage lenders are individuals or mortgage investment entities that offer their own pooled capital that are secured against real estate. Contrary to chartered banks, they are not bound by the same federal stress test and income verification rules. Each lender has its own guidelines and this the reason two private lenders can answer very differently to the same property.

This independence is the key appeal. Decisions are usually made by people instead of automated scoring systems so a lender can have a look at the full story: the property, the neighbourhood, the borrower’s plan and the strength of the exit. For files that look complex on paper, that human review usually makes a great difference.

Private Lenders vs. Banks vs. B-Lenders

Canadian borrowers generally choose between three lender categories. Knowing where each one fits helps you avoid paying more than you need to or waiting longer than your timeline allows.

Traditional Bank

·       Main focus: Credit score and income

·       Approval speed: Several weeks

·       Typical term: 1 to 5 years

·       Best suited for: Borrowers with strong credit profiles and documented income

B-Lender

·       Main focus: Moderate credit flexibility

·       Approval speed: One to two weeks

·       Typical term: 1 to 3 years

·       Best suited for: Borrowers with bruised credit or limited income proof

Private Lender

·       Main focus: Property equity and location

·       Approval speed: Often within days

·       Typical term: 6 to 24 months

·       Best suited for: Urgent financing needs, complex applications, or non-standard borrower profiles

A sensible strategy is often to use a private mortgage as a bridge. You solve the immediate problem, then move into a lower-cost B-lender or bank mortgage once your credit, income documentation or property situation has improved.

Situations Where a Private Mortgage Makes Sense

Private lending is a tool, and like any tool it works best for the right job. These are some of the most common scenarios we see:

•         Time-sensitive purchases: A purchase deadline or a competitive offer does not leave room for a lengthy bank process.

•         Income that is hard to document: Commissioned earners, contractors and business owners often show lower taxable income than they actually earn.

•         Credit setbacks: A consumer proposal, collections or past missed payments can limit mainstream options even when the property is strong.

•         Power of sale or foreclosure pressure: Refinancing early can protect your home and give you time to stabilize.

•         Investment opportunities: Investors may need fast capital to acquire, renovate or reposition a property before refinancing long term.

Types of Private Mortgages Available

First Position Private Mortgages

A first mortgage sits ahead of any other debt on the title. Because the lender has first claim on the property, first position loans usually offer the most competitive private pricing and the highest available loan amounts.

Second and Third Position Mortgages

If you already have a good rate on your existing mortgage, a second position loan lets you access equity without disturbing it. These carry more risk for the lender, so rates and fees are typically higher, and the amount available depends on the combined loan-to-value ratio.

Bridge Financing

Bridge loans cover the gap between buying a new property and selling the current one, or between a short-term need and a longer-term refinance. They are intentionally temporary and priced accordingly.

What Private Lenders Look At

Although credit and income are not the main drivers, a lender still needs confidence that the loan is safe and will be repaid. Expect the following to carry the most weight:

•         Loan-to-value ratio: The lower the loan relative to your property’s value, the stronger your file.

•         Property type and location: Homes in well-established, liquid markets are easier to place than remote or highly specialized properties.

•         Mortgage position: First position loans are viewed more favourably than second or third.

•         Exit strategy: A clear, believable plan to repay or refinance at term end is essential.

•         Borrower story: A short, honest explanation of how you arrived here and how you will move forward builds trust.

Understanding the Costs

Private mortgages cost more than conventional products, and it is important to look at the full picture rather than the rate alone. Beyond the interest rate, borrowers commonly encounter lender fees, broker fees, legal fees for both sides, appraisal charges and sometimes a title insurance or administration fee. Ask for a written breakdown of every cost before you commit, and calculate the total expense over the planned term.

Because these loans are short-term, many borrowers choose interest-only payments to keep monthly cash flow manageable. Just remember that the principal remains due at the end of the term, so your exit plan needs to be as carefully prepared as the application.

Regulation and Borrower Protection in Ontario

Mortgage brokerages and agents in Ontario are regulated by the Financial Services Regulatory Authority of Ontario (FSRA). Working with a licensed brokerage means your agent is bound by professional standards, including disclosure requirements and a duty to recommend products that suit your circumstances. Always confirm a brokerage’s licence number, and get independent legal advice before signing any mortgage commitment.

Take the Next Step with Everlend!

Everlend is a Canadian mortgage brokerage operated by DC Home Mortgages (FSRA #13152), based in North York, Ontario. Our philosophy is simple: we do not just lend, we help you move forward. Rather than offering a single product, we work as an independent guide, matching each client with private lenders, B-lenders and alternative solutions that suit their goals.

Our clients come to us for purchases, refinances, debt consolidation, second mortgages, renovation funding, self-employed mortgages, home equity lines of credit and investment property financing. Whether you need a short-term bridge or a longer-term plan to return to mainstream lending, we aim to explain every option in plain language, so there are no surprises at closing.

Private lending can be a smart, short-term solution when the right lender and the right plan are in place. Speak with an Everlend mortgage agent today to review your property, your timeline and your options, and find out what private mortgage lenders in Canada could offer you.

If you are ready to talk through your situation, call us at +1 416-618-0786, email info@everlend.ca or visit us at 150 Ferrand Drive, Suite 1500, North York, ON.

Frequently Asked Questions About Private Mortgage Lenders in Canada

What is a private mortgage lender in Canada?

A private mortgage lender is an individual or a mortgage investment entity that lends against real estate rather than relying mainly on a borrower’s credit score or income. Because they are not federally regulated banks, they can set their own guidelines and make decisions faster.

How much equity do I need to qualify?

Most private lenders want a meaningful equity cushion. Maximum loan-to-value limits are commonly lower than at banks and depend on the property type, location and mortgage position. A broker can tell you what is realistic for your specific home.

Are private mortgage rates higher than bank rates?

Yes. Private mortgages generally carry higher interest rates and lender or broker fees than bank products, because the lender accepts more risk and offers more flexibility and speed. They are designed as a short-term solution, not a permanent one.

Can I get a private mortgage with bad credit?

Often, yes. Credit history is considered, but equity in the property is the primary factor. Past late payments, a consumer proposal or a recent bankruptcy do not automatically rule you out.

How long does a private mortgage last?

Terms are typically short, commonly between six months and two years. The expectation is that you will renew, refinance or move to a conventional lender once your situation improves.

What is an exit strategy and why does it matter?

An exit strategy is your plan to repay or replace the private mortgage at the end of the term, for example by refinancing with a bank, selling a property or receiving business income. Lenders look at it closely, so it is worth planning early.

Do I need a mortgage broker to access private lenders?

Many private lenders work mainly through brokers. A licensed broker can compare options, negotiate terms and help you avoid unsuitable offers, which is especially important when speed matters.

How do I get started with Everlend?

Call +1 416-618-0786, email info@everlend.ca or use the Apply Now button. A mortgage agent will review your goals, your property and your timeline, then outline your options.