Banks are tighter. HELOCs are frozen. Self-employed income is discounted. Appraisals are conservative. Approvals collapse at the last minute. And for many homeowners across Ontario, equity has quietly become the most reliable form of financial leverage left.
That’s why private mortgages are no longer a last resort — they’re a strategic tool.
This guide breaks down how private lending actually works, who it’s for, the risks, and why borrowers and investors are turning to equity-based solutions in record numbers.
What Is a Private Mortgage?
A private mortgage is financing secured against real estate and approved primarily on property value and equity — not traditional bank checklists.
Private lenders focus on:
Loan-to-value (LTV)
Property type & location
Exit strategy (sale, refinance, payout)
Risk-adjusted pricing
Not:
Perfect credit
T4 income
Stress tests
Endless conditions
Who Uses Private Mortgages in 2026?
✔ Self-Employed Borrowers
Business owners, contractors, commission earners, and entrepreneurs often earn strong income — but don’t “look good on paper.” Private lending solves that gap.
✔ Bad Credit Mortgages
Late payments, collections, or past consumer proposals don’t eliminate equity. Strong property value can outweigh weak credit.
✔ Mortgage Arrears & Stop Power of Sale
Private mortgages are one of the fastest ways to:
Stop power of sale
Clear mortgage arrears
Stabilize cash flow
Time matters. Equity acts fast.
✔ Debt Consolidation
High-interest debt is quietly crushing homeowners.
Private refinancing allows:
Credit cards
CRA arrears
Lines of credit
Personal loans
to be rolled into one manageable payment.
Specialized Equity Solutions Canadians Are Using
🏡 Probate & Estate Loans
Estates often hold property but lack liquidity.
Private loans help:
Pay estate taxes
Buy out beneficiaries
Avoid forced sales
💰 Living Inheritance
Parents unlock home equity to help children:
Buy homes
Start businesses
Avoid high-interest debt
— without selling or downsizing.
💔 Divorce Buyout Loans
When one spouse keeps the home, private financing enables:
Spousal buyouts
Fast settlements
Clean title transfers
🚨 Emergency Loans & Insurance Payout Loans
Waiting months for insurance or legal settlements?
Equity-based bridge loans provide immediate liquidity.
Property-Based Lending Options
🔹 Jumbo Equity Loans (First Mortgages)
Ideal for high-value homes requiring:
$1M+ financing
Equity-only approvals
Flexible terms
🔹 Second Mortgages
Used when:
HELOCs are frozen
First lenders won’t refinance
Speed is critical
🔹 Purchases & Refinance
Private lenders fund:
Unique properties
Time-sensitive purchases
Refinances banks won’t touch
🔹 Home Equity Lines (Private)
Structured alternatives to bank HELOCs — without surprise freezes.
🔹 Bridge Loans
Short-term solutions between:
Purchase & sale
Refinance & payout
Construction phases
Business, Land & Construction Financing
🌾 Farm Loans & Farmer Loans
Banks avoid agricultural complexity.
Private lenders understand:
Farmland value
Seasonal cash flow
Equipment & land equity
🏗 Construction Loans
From custom homes to renovations:
Draw-based funding
Equity-driven approvals
Faster timelines
🌍 Land Loans
Vacant land, severances, and development land often require private capital first.
🏢 Business Loans
Real estate-secured business financing allows owners to grow without diluting ownership.
Understanding Borrower Risks
Private lending is powerful — but not casual.
Borrowers must understand:
Higher rates reflect higher flexibility
Clear exit plans are essential
Shorter terms require strategy
Used correctly, private mortgages solve problems — not create them.
Investor Perspective: Mortgage Notes & MIC Investment
Private mortgages are also drawing investors seeking:
Predictable yield
Real-asset backing
Inflation-resilient income
Through mortgage notes and MIC investment structures, investors gain access to professionally underwritten, asset-secured opportunities — while understanding investor risks such as market cycles, liquidity, and borrower performance.
Why Brokers Are Sending Deals to Private Lenders
Mortgage brokers increasingly rely on private capital when:
Banks say “approved… then declined”
Deadlines are immovable
Clients need certainty, not maybes
Speed, clarity, and execution matter.
Tools & Education for Smarter Borrowers
Smart borrowers don’t guess — they learn.
Explore:
FAQs for common scenarios
Glossary for private lending terms
Resources to plan exits
Forum discussions on real borrower experiences
Our Blog for market insights
Knowledge is leverage.
Final Thought: Equity Is the New Approval
In 2026, equity decides — not algorithms.
Whether you’re dealing with:
Mortgage arrears
Divorce
Estate planning
Business growth
Emergency liquidity
Private lending has become the most adaptable financing tool in Canada.
Your home isn’t just where you live.
It’s your strongest financial asset — when used correctly.
Your equity deserves more™