FAQ – Private Mortgage Questions

A private mortgage is a home loan funded by an investor or a mortgage investment corporation (MIC) instead of a traditional bank. At Lendworth, we focus on asset-based lending, which means we look primarily at your home’s equity and the property itself—not just your income or credit score.

Banks rely on strict income verification, tax returns, NOAs, and minimum credit scores. A private mortgage with Lendworth is more flexible. We look at your equity, property, and exit strategy, allowing us to approve files that banks decline and to move much faster when timing is critical.

Private mortgages are ideal for: • Self-employed borrowers • Credit-challenged or recently bankrupt borrowers • Homeowners in arrears or facing Power of Sale • People needing funds quickly for business, legal, or personal reasons If you have equity in your Ontario property, a private mortgage may be the fastest solution.

In many cases, we can issue a conditional approval within the same business day, provided we have your basic information (property address, estimated value, mortgage balance, and purpose of funds). Funding can often occur within 24-48 hours, depending on your lawyer’s availability.

To begin, we typically ask for:

• Property address

• Current mortgage balance

• Estimated property value

• Purpose of funds

• Government-issued ID

• Recent mortgage statement

We usually do not require full income documents or tax returns for most private mortgage files.

We may review your credit, but it is not the deciding factor. Our decisions are based primarily on your home’s equity, the property type, and the overall risk of the file. Many clients are approved even with bruised or low credit scores.

Yes. Power of Sale and arrears financing are a core part of what we do. If your lawyer can act quickly, we can often arrange funding fast enough to stop or delay a Power of Sale. If you are in this situation, contact us immediately.

Rates depend on your loan-to-value (LTV), property type, location, and overall risk. Generally: • First mortgages: often in the 7%–10% range • Second mortgages: often in the 10%–14% range We provide a clear quote before you commit so there are no surprises.

Common closing costs include lender fees, legal fees (for both your lawyer and the lender’s lawyer), appraisal costs (if required), title insurance, and administrative or processing fees. Lendworth is fully transparent and will outline all fees up front in writing.

Most private mortgages are structured as interest-only, which keeps monthly payments lower and improves cash flow. In some cases, we can also structure amortizing payments or partially prepaid interest, depending on your needs and exit strategy.

We generally lend up to 80% loan-to-value (LTV), depending on the region and property type. Urban, detached residential properties in Ontario tend to qualify for higher LTVs than specialized or rural properties.

Yes. A second mortgage allows you to access additional equity without breaking your existing first mortgage. This is common for debt consolidation, arrears, renovations, or business capital.

Yes. If you add a second mortgage, your existing first mortgage remains in first position on title. The new mortgage will rank behind it as a second charge.

If you own the property as joint tenants, all owners must typically consent and sign for a new mortgage. In a tenants-in-common structure, it may be possible to finance an individual’s share, but in practice, most lenders—including Lendworth—require the consent and participation of all owners for a new mortgage charge on title.

Yes. You may choose any Ontario real-estate lawyer to represent you, provided they are in good standing. We will also have independent legal representation on the lender side.

We lend across many parts of Ontario, including: • Toronto & the GTA • Vaughan, Richmond Hill, Markham • Mississauga, Brampton, Oakville • Hamilton, Burlington, Niagara • Barrie, Simcoe, Durham, Halton, York Region If you are unsure about your area, contact us and we will confirm availability.

Most private mortgage terms range from 6 to 24 months. They are designed as short-term solutions to bridge you from your current situation to a better long-term position, such as refinancing with a bank or selling the property.

Yes, renewals are often available based on your payment history, the current value of the property, and the overall risk at renewal. We will discuss renewal options well before your term matures.

Early payout options can be structured differently depending on the deal. Some files include a minimum interest period or a reduced early payout fee. We will explain your payout terms clearly before you sign, so you always know where you stand.