Understanding Private Mortgages in Ontario: A Local Perspective

Private Mortgages in Canada: The Simple Guide 

Buying a home or refinancing can feel confusing — especially when the bank says “no” or when life changes fast. That’s where private mortgages can help.

This guide keeps everything simple, clear, and designed for real Canadians who just want to understand their options.

What Is a Private Mortgage? 

A private mortgage is a home loan that comes from a person or a private company, not a big bank.

Think of it like this: A bank says, “Sorry, your numbers don’t fit our boxes.”
A private lender says, “Let’s see what we can do.”

Private lenders in Canada ARE regulated, and they can be:

✔ individuals
✔ investor groups
✔ mortgage investment corporations (MICs)
✔ private lending companies

Private mortgages help when the bank rules are too strict — and let’s be honest, banks reject good people every single day.

Why Do People Use Private Mortgages?

Private mortgages are common for people who:

✔ are self-employed with low taxable income
✔ have credit issues or past missed payments
✔ are going through a separation or divorce
✔ need fast access to money
✔ want to consolidate debt quickly
✔ don’t fit bank or credit union guidelines
✔ need temporary help until their finances improve

Private mortgages are not bad — they are simply another tool to help you keep your home, fix your finances, or move forward after life changes.

How Do Private Mortgages Work? 

Private mortgages work a lot like regular mortgages, but with:

✔ Faster approvals & funding (can fund within 5 business days)

✔ Easier rules because they focus on the property value, not just your income.

✔ Shorter terms: Usually 12-24 months, which gives you time to rebuild and then switch to a better mortgage product later.

✔ Higher down payment requirements (often 20%–35% equity is needed)

✔ A clear exit plan: A private mortgage should always be temporary — not forever.

Why Are Rates Higher?

Private mortgages have higher interest rates because:

• lenders take on more risk
• approvals are much faster
• you don’t need perfect credit
• income rules are flexible

But remember:
📌 Private mortgages are meant to be short-term — like a band-aid, not a lifestyle.

Benefits of a Private Mortgage 

✔ Fast access to money
✔ Flexible approval
✔ Helps with debt consolidation
✔ Lets you keep your home through a tough time
✔ Helps rebuild credit
✔ Perfect for separation, self-employed income, or refinancing
✔ Can save you from high-interest credit cards or collections
✔ Protects your equity

Risks (What You Should Know)

❗ Higher interest rates
❗ Short-term loans mean you must plan ahead
❗ Some out-of-town brokerages push expensive fees
❗ Not all private lenders are regulated

And this is why choosing the right mortgage agent matters more than anything.

⭐ Why You Should Use a Local Mortgage Agent (Not Out-of-Town Companies Like Nuborrow)

This part is important.

Many big online companies and “call-centre style” brokerages push quick private mortgages because they make huge fees.
They don’t always care about you — they care about the transaction.

Here’s why using a local agent is better:

1️⃣ Local lenders = better terms
I work with Ontario-based private lenders who understand Sarnia, Lambton County, London, Chatham, and surrounding areas.

2️⃣ You get real advice, not pressure
We pick a mortgage that makes sense — not the one that pays the biggest commission.

3️⃣ Private mortgages require a plan
My job is to get you BACK to a cheaper A or B lender.
Call centres don’t follow up. I do.

4️⃣ I review ALL fees, conditions, and exit strategies
Including:

• lender fees
• broker fees
• renewal options
• payout penalties
• legal expectations

5️⃣ Out-of-town companies don’t know our market
But I work here. I know real property values, real buyers, real lenders, and real solutions.

6️⃣ You’re not just a number
I care about where you end up financially — not just whether the deal funds.

How Private Mortgages Are Regulated in Canada

Yes, private mortgages are regulated — just not as strictly as banks.

This means:

✔ you get legal contracts
✔ your lawyer reviews everything
✔ your rights are protected
✔ the lender must follow Ontario lending rules

But you should never borrow from an unlicensed, unregulated person. A good licensed mortgage agent (like me!) only works with safe, approved lenders.

 ⭐ Is a Private Mortgage Right for You?
Ask yourself:

🔸 Do I need help fast?
🔸 Am I going through a major life change?
🔸 Do I have at least 20% equity?
🔸 Do I need temporary breathing room?
🔸 Do I plan to refinance soon?

If you said yes to any of these, a private mortgage might be the perfect solution — as long as you have the right exit plan.

Final Thoughts: Private Mortgages Are Not the “Bad Guy”

A private mortgage is simply a tool — one that can help you:

✔ stay in your home
✔ rebuild your credit
✔ buy out a spouse during separation
✔ access equity
✔ avoid high-interest debt
✔ move forward financially

The key is choosing someone local, someone trustworthy, and someone who actually cares about what happens to you next.

And that’s exactly how I work with every client.

 
Want to Know if a Private Mortgage Is Right for You?
Let’s look at your situation together — no pressure, no judgment.

📞 519-339-0883
📩 [email protected]
🌐 www.chatwithashley.ca

Private mortgages don’t need to be scary. You just need the right guide.