What Ontario borrowers should know
The best place to start is with the specific reason the application falls outside conventional lending guidelines. Often, yes - but only if the borrower and property fit a lender whose guidelines address the specific issue. A targeted application is usually more effective than sending the same file to several lenders and hoping one uses a different rule.
A private mortgage is secured by the property
The important detail is that like other mortgage lenders, a private lender can have enforcement remedies if the borrower defaults, subject to the mortgage terms and applicable law.
Default should be addressed early
In practice, missing payments, property-tax arrears, insurance problems, or maturity without repayment can escalate costs quickly.
Get legal advice if enforcement is threatened
From an underwriting perspective, borrowers facing default or power-of-sale concerns should obtain independent legal advice promptly rather than relying solely on general mortgage information.
The cost question
If the borrower expects to qualify with a B lender in nine months, a private mortgage can be structured as a bridge. If there is no realistic improvement or sale event, repeated private renewals can become expensive.
Documents to have ready
- or request current first-mortgage statement and maturity date
- or request property tax status and any other registered secured debts
- or request a realistic property value or recent appraisal if available
- or request the exact amount needed, intended use of funds, and planned payoff or refinance date
Talk to Approval Path Mortgages
A clear comparison of options is more valuable than chasing the first approval available. Approval Path Mortgages can review the file, compare suitable lender categories, and explain the cost and trade-offs before another application is submitted.
No credit check. No documents. No obligation.
General information only; mortgage approval and terms vary by lender and borrower. Not legal, tax, insolvency, or financial advice.