Short-term, equity-based
Private Mortgages: What They Solve, and What They Cost
Private financing is short-term, equity-based, and expensive relative to other options. It suits specific problems — and it should always come with an exit strategy.
Takes about two minutes. No obligation. No judgment.
Licensed in Ontario
Phil Cragg, Mortgage Agent, Licence #11000073 · Mortgage Outlet Inc., Brokerage #12628
Confidential by design
No credit check to start, and no documents requested through this website.
15 years, across Ontario
Office in Toronto. Clients across the province served by phone, video, and secure document handling.
What this actually means
Private mortgages are funded by individual investors, mortgage investment corporations, or syndicates rather than institutions. Decisions rest heavily on the property and equity, with less weight on credit and income.
Terms are typically short — often six to twelve months — and interest-only. Rates are materially higher than institutional lending, and lender fees, brokerage fees, legal fees, and appraisal costs all apply.
Private financing is a tool for a defined problem with a defined end date. Without a realistic exit — a sale, a refinance, a resolved credit issue, or restored income — a private mortgage can make a difficult situation worse.
Situations we see most often
- A closing date is approaching and traditional financing will not be ready in time.
- Arrears or enforcement action need to be resolved quickly.
- The property type or condition falls outside institutional guidelines.
- You need a short bridge while a longer-term solution is arranged.
- You have been offered private financing and want the terms reviewed independently.
Possible pathways and their trade-offs
Short-term bridge with a defined exit
Private financing used deliberately to solve a timing problem, alongside a written plan for what repays it.
Trade-off: High cost over the term. The exit must be realistic, not hopeful.
Second-position private charge
Preserves an existing favourable first mortgage while addressing an immediate need.
Trade-off: Higher rate and fees than a first charge, and it adds a second payment obligation.
A different route entirely
Selling, negotiating directly with the existing lender, or seeking legal or insolvency advice is sometimes the more suitable recommendation.
Trade-off: May not preserve ownership, and may require professional advice outside a brokerage's scope.
Documents usually involved
Nothing is uploaded through this website. Documents are only requested later, through an approved secure process.
- Mortgage statement, including any arrears
- Property details and recent value information
- Any notices, demands, or deadlines you have received
- Proof of income, where available
- An outline of how you expect the loan to be repaid
Costs and compensation
Before you go further
Questions about this situation
What questions should I ask before accepting a private mortgage?
What is the total cost over the full term including all fees; what happens at maturity; is there a renewal fee; what are the prepayment terms; who is the lender; and what specifically repays this loan. If any of those cannot be answered clearly, slow down.
Do I need a lawyer?
Yes. Private mortgage transactions require independent legal representation, and reviewing the commitment carefully with your lawyer before signing is strongly recommended.
Is private financing a long-term solution?
It is generally not designed to be. It is short-term financing, and it should be entered into with a specific plan for how and when it ends.
Related situations
Mortgage Arrears and Urgent Situations
Time-sensitive situations including arrears, closing deadlines, and enforcement pressure.
Alternative Mortgage Solutions
How alternative lenders assess files differently from banks, and what that flexibility actually costs.
Debt Consolidation and Equity Take-Out
Review whether consolidating high-interest debt into your mortgage genuinely improves your position.
Information on this website is general in nature and is not a commitment to lend, an approval, legal advice, tax advice, or financial advice. Mortgage availability, rates, terms, fees, and approval depend on the applicant, the property, lender requirements, market conditions, and applicable law. An application and supporting documents may be required.