Private Mortgages in Ontario
When the bank says no, a private mortgage looks at the equity in your home and the strength of your plan, not just your credit score. It can help you stop a power of sale, clear arrears or tax debt, or access your equity when traditional lenders will not.
LendToday finds private mortgage solutions for homeowners across Ontario, from the Greater Toronto Area and Durham Region to Ottawa, Hamilton and London. Below you will find typical rates, fees and terms, so you know what to expect before you apply.
*Typical rate range as of November 2026. Not a rate offer. Your rate depends on your property, equity, mortgage position and full application, and is subject to lender approval.
What Is a Private Mortgage?
A private mortgage is a loan secured against your home that comes from a private lender rather than a traditional bank. Private lenders can be individuals, groups of investors, or lending companies that fund mortgages outside the strict rules the big banks follow.
Because the loan is secured by your property, a private lender focuses first on your home equity and the strength of your exit plan. Your credit score and income still matter, but they do not carry the same weight they would at a bank. This is why a private mortgage is often possible even when a bank has already turned you down.
Private mortgages are usually a short-term bridge. They give you room to solve a pressing problem, stabilize your finances, and then move back to more traditional financing. Ontario's regulator, the Financial Services Regulatory Authority of Ontario (FSRA), advises borrowers to understand the costs and have a realistic exit strategy before signing. For a deeper look at approval, read our guide to qualifying for a private mortgage or separate fact from fiction with private mortgage myths vs reality.
Private Mortgage Rates and Fees in Ontario
Private mortgages cost more than bank mortgages because the lender takes on more risk and the loans are short-term. Your rate depends largely on your mortgage position: a first mortgage is the lowest risk for the lender, a third mortgage the highest. Here are the typical ranges we see for LendToday clients.
| Mortgage Position | Typical Rate Range | What It Means |
|---|---|---|
| Private first mortgage | 6.99% to 10.99% | Replaces your existing mortgage, or is the only mortgage on the home |
| Private second mortgage | 7.99% to 14.99% | Sits behind your first mortgage, which stays in place |
| Private third mortgage | 10.99% to 15.99% | Sits behind both a first and a second mortgage |
Fees To Expect
Typically 2.5% to 5% of the loan amount, depending on the final approval. Charged by the private lender for setting up the mortgage.
Typically 2.5% to 5% of the loan amount, depending on the final approval. Charged by the brokerage for sourcing and arranging the mortgage.
You will need a lawyer to review the documents and register the mortgage on title.
Most private lenders require a current appraisal to confirm your home's value and equity.
Ranges are typical as of November 2026 and are not a rate or fee offer. Every rate and fee that applies to your mortgage is disclosed to you in writing before you sign.
How Much Can You Borrow?
Most private lenders will lend up to 80% of your home's value, combined with any mortgage already on the property. In rare cases, a lender may go to 85% when there is a strong, well-documented exit strategy.
To estimate your room, take 80% of your home's value and subtract what you currently owe.
For a quick estimate using your own numbers, try our home equity calculator.
Example
- Home value: $800,000
- 80% of value: $640,000
- Current mortgage: $450,000
Up to about $190,000 available, before fees and closing costs. The final amount depends on your appraisal, your mortgage position and the lender's approval.
Payment Example
- Private second mortgage: $150,000
- Rate: 9.99%, interest-only
- Term: 12 months
Monthly payment: about $1,249. Because the payment covers interest only, the balance is still $150,000 at the end of the term.
Typical Terms and Payments
Private mortgages are short-term loans. Most have a 12 or 24 month term, which gives you time to solve the problem and get ready to move to lower-cost financing.
Most private mortgages are interest-only, which keeps the monthly payment lower but does not reduce what you owe. Some private first mortgages are amortized, meaning each payment also pays down part of the balance.
When the term ends, you can renew with the same lender (a renewal fee may apply), refinance to another lender, or pay the mortgage off, for example by selling.
Types of Private Mortgages in Canada
A private mortgage is not one single product. The right structure depends on what you already owe, how much equity you have, and what you are trying to solve. If you are building a home, see our private construction mortgages.
First Mortgage
A private first mortgage sits in first position on your home. Homeowners often use one when a bank will not renew or approve a new mortgage, but the equity is there to support the loan.
Second Mortgage
A private second mortgage sits behind your existing first mortgage. It lets you tap equity without touching a low-rate first mortgage you want to keep in place.
Bridge Financing
Private bridge financing covers a short gap, such as the time between buying a new home and selling your current one. Learn more about bridge loans from private lenders.
Debt Consolidation
A private mortgage can roll several high-interest debts into one payment secured by your home, often clearing collections or arrears that a bank will not work around.
Home Equity Access
If you have built equity but cannot qualify for a traditional home equity loan, a private mortgage can turn that value into funds you can use.
Refinancing
A private mortgage can refinance an existing loan to stop a pressing problem, such as arrears or a looming power of sale, and give you time to get back on track.
When a Private Mortgage Makes Sense
A private mortgage is not the right fit for everyone, but for many homeowners it is the most direct way to solve a problem the bank cannot help with. It is often worth considering when:
- You have equity in your home but the bank has declined you
- Your credit has taken a hit and you need a solution now
- You are self-employed or have income that is hard to document
- You are behind on your mortgage, property taxes, or CRA payments
- You need funds quickly for a time-sensitive situation
- You want to consolidate high-interest debt into one payment
Private Mortgage vs Bank Mortgage
A private mortgage and a bank mortgage both use your home as security, but they work very differently. Here is a general comparison to help you see where a private mortgage fits.
| Factor | Private Mortgage | Bank Mortgage |
|---|---|---|
| Approval based on | Home equity and your exit plan | Credit score, income, and strict ratios |
| Credit requirements | Flexible, equity-driven | Strong credit usually required |
| Income documentation | Flexible, works for self-employed | Full, traditional proof of income |
| Interest rate | Higher, typically from 6.99% depending on position | Lower, based on bank rates |
| Fees | Lender fee and broker fee usually apply | Usually no setup fees on a standard mortgage |
| Payments | Often interest-only | Principal and interest |
| Typical term | 12 or 24 months | 1 to 5 years, often 5 |
| Best for | Solving a pressing problem the bank cannot help with | Standard financing when you meet bank criteria |
| Speed of process | Often faster once equity is confirmed | Slower, rigid approval process |
Not sure where you fit? Compare A lenders, B lenders and private lenders, or explore refinancing to consolidate debt and a home equity line of credit.
Your Exit Strategy
A private mortgage works best when you know how you will move off it. Lenders want to see a realistic plan, and it is the single biggest factor in keeping your costs down. Most exit strategies fall into one of three paths.
Refinance to a Bank or B Lender
Use the term to pay on time, rebuild your credit and get your income documents in order, then refinance into lower-cost financing. See refinancing a private mortgage.
Sell the Property
If you plan to downsize or move, the private mortgage can give you time to sell on your schedule instead of under pressure.
Pay It Down
Some borrowers repay from a known future event, such as the sale of another property, a business payout or an expected settlement.
Building credit during your term makes the move back easier. Here are practical tools to rebuild your credit.
Why Homeowners Choose LendToday
One application, many lenders. A private lender can only offer its own money. As a brokerage, we compare options across our network of private and alternative lenders, so you are not stuck with the first offer.
Experience that works for you. Our team brings more than 30 years of combined experience helping Canadians access financing when the bank has said no.
We work where banks won't. We look at your equity and your plan, so a bruised credit history, a high debt load, or income that is hard to document does not automatically rule you out.
Costs explained before you commit. We walk you through the rate, the lender fee, the broker fee and closing costs, and everything is disclosed in writing before you sign.
Guidance beyond the mortgage. A private mortgage is usually a bridge, so we help you map a path back to traditional financing.
What You Can Use a Private Mortgage For
Homeowners turn to private mortgages to solve a wide range of problems that banks will not touch. Choose the situation that fits yours to learn more.
Why Your Bank May Say No
Traditional banks follow rigid lending rules, and a strong homeowner can still be turned down for reasons that have little to do with whether they can afford the payment. When the bank says no, it is rarely about your character. It is about a checklist you did not fit.
Common reasons a bank declines an otherwise capable homeowner include:
- A low or bruised credit score
- Too much existing debt relative to income
- Failing the federal mortgage stress test, which requires you to requalify at a higher rate
- Self-employed or hard-to-document income
- A history of missed or late payments
- A current or past consumer proposal or bankruptcy
- Mortgage arrears or falling behind on payments
A private lender weighs your equity and your plan far more heavily, and is not bound by the federal stress test that banks must apply. This is often the path forward for homeowners dealing with mortgage arrears, property tax arrears, or CRA tax debt.
Do You Qualify for a Private Mortgage?
Qualifying for a private mortgage is less about a perfect credit file and more about the equity in your home and a workable plan. You may be a strong candidate if the following are true.
- You own a home in Ontario with equity built up in it
- You have a clear reason for the funds and a plan to move forward
- You can support a manageable monthly payment
- You are willing to treat the private mortgage as a short-term bridge
Even if you are behind on payments, self-employed, or carrying bruised credit, a private mortgage may still be within reach. For the full checklist, read our guide to qualifying for a private mortgage, or learn about a bad credit mortgage and self-employed mortgage options.
How to Get a Private Mortgage With LendToday
Getting started is simple, and there is no obligation to proceed. Here is what the process looks like from your first step to a clear answer.
Fill out our short, secure application. It takes only a few minutes and there is no obligation.
We look at your home equity and your goals, not just your credit score, to understand what is possible.
Drawing on our network of private and alternative lenders, we find the private mortgage that fits your situation and explain every cost involved.
Apply today and we will typically get back to you within 24 hours with a clear picture of what is possible.
How a Private Mortgage Can Help: An Example
Clearing Debt and Arrears With a Private Second Mortgage
A homeowner's property is worth $700,000, with $380,000 left on their first mortgage. After a job loss, they fell behind on payments and built up about $60,000 in credit card debt, a car loan and mortgage arrears. Their bank will not lend more.
- Private second mortgage: $70,000, covering the debts and closing costs
- Rate: 11.99%, interest-only, 12-month term
- Total borrowing: $450,000, about 64% of the home's value
- Monthly payment on the second mortgage: about $699, replacing several higher payments
Over the next 12 months, they pay on time and rebuild their credit, then refinance both mortgages with a lower-cost lender. This is an illustrative example, not a real client. Your amount, rate, fees and term depend on your property, equity and application.
See how this has worked for a real homeowner in our power of sale case study, or browse all client case studies.
Ready to Explore a Private Mortgage?
If the bank has said no, a private mortgage may be the solution that keeps you in your home and back in control. At LendToday, we lay out your options and every cost clearly, with no obligation to proceed.
Apply online today and we will typically get back to you within 24 hours.
Private Mortgage FAQs
What is a private mortgage?
A private mortgage is a loan secured against your home from a private lender rather than a bank. Private lenders focus on your home equity and your plan to repay, so a private mortgage is often possible even when a bank has declined you.
What are private mortgage rates in Ontario?
As of November 2026, typical ranges for LendToday clients are 6.99% to 10.99% for a private first mortgage, 7.99% to 14.99% for a second mortgage, and 10.99% to 15.99% for a third mortgage. Your rate depends on your property, equity, mortgage position and application.
What fees come with a private mortgage?
A private mortgage usually has a lender fee, typically 2.5% to 5% of the loan amount, and a broker fee, also typically 2.5% to 5% of the loan amount, depending on the final approval. You will also have legal fees and usually an appraisal. Every cost is disclosed to you in writing before you sign.
How much can I borrow with a private mortgage?
Most private lenders lend up to 80% of your home's value, combined with any existing mortgage. In rare cases a lender may go to 85% with a strong exit strategy. To estimate your room, take 80% of your home's value and subtract what you owe.
Are private mortgage payments interest-only?
Most are. Interest-only payments keep your monthly cost lower, but the balance does not go down. Some private first mortgages are amortized, so each payment also reduces the balance.
How is a private mortgage different from a bank mortgage?
A bank mortgage depends on strong credit, full income proof, and strict ratios. A private mortgage leans on your home equity and your exit plan, which makes it flexible for homeowners with bruised credit, hard-to-document income, or a pressing problem to solve. In return, rates and fees are higher and terms are shorter.
Can I get a private mortgage with bad credit?
Often, yes. Because a private lender weighs your home equity more heavily than your credit score, a private mortgage is frequently possible even after a bank has said no. Learn more about a bad credit mortgage.
Is a private mortgage a long-term solution?
Usually not. Most private mortgages have a 12 or 24 month term and are meant as a short-term bridge. The goal is to solve the pressing problem, stabilize, and move back to traditional financing. See refinancing a private mortgage.
Can I get a private mortgage if I am self-employed?
Yes. Self-employed and hard-to-document income does not automatically rule you out, because approval leans on your home equity and your plan. Learn more about self-employed mortgage options.
Can a private mortgage stop a power of sale or foreclosure?
Often, yes. A private mortgage can refinance your situation to clear arrears and buy you time when you are facing a power of sale. If you are behind on payments, explore our help with missed mortgage payments and stopping a power of sale.
Can I use a private mortgage to pay off CRA or property tax debt?
Yes. Many homeowners use a private mortgage to clear CRA tax debt or property tax arrears before penalties or a tax sale escalate, then refinance later once the balance is cleared.
How fast can I get a private mortgage?
We typically respond within 24 hours of your application with a clear picture of your options, and private lenders can often approve within 24 to 48 hours once your documents are ready. Funding timelines depend on the appraisal and legal work.
Do you only help homeowners in Ontario?
LendToday and its agents are licensed under an Ontario mortgage brokerage, serving homeowners across the province, from the Greater Toronto Area and Durham Region to Ottawa, Hamilton, and London. Contact us to find out what private mortgage options are available for your situation.