A Private mortgage loan is a loan funded by an individual investor or private lending company as opposed to a traditional financial institution like a bank. These loans are typically used when the borrower doesn’t meet the criteria of the more conventional lenders. This could be anything from credit issues to unique income sources and unconventional properties.
The terms can vary for private mortgages, but they are often short-term (6 months to 3 years) and secured by real estate - this makes them more appealing for people who need quick approvals or more flexibility.
Private mortgage lenders assess risk quite differently from banks. While traditional lenders rely heavily on credit scores, typical income streams, and government-regulated debt-to-income ratios, private lenders focus more on:
Further, approvals for private mortgage loans are typically faster, with some loans being approved within 24 to 48 hours. This is because private mortgage lenders have a less bureaucratic process and tend to be more open to financing:
Yes - granted if you do your due diligence. Reputable private mortgage lenders operate legally and transparently - many of which are licensed under provincial regulations or work with mortgage professionals like me who vet lenders carefully. That being said, private mortgages are more likely to carry higher interest rates and shorter terms, so it is important to fully understand:
I can help you decide if a private lender is the right fit for your situation. Better yet, I will create a customized solution where you can get the most out of your money. Book a call and I’ll get in touch within 24 hours.
There are three main ways to connect with Private Mortgage Lenders:
As noted, private mortgage rates are typically higher than bank rates due to an increased risk from the private lender and fewer barriers to qualification. In 2025, average rates range from:
Private lending certainly isn’t for everyone - but it can be the right tool for the following situations:
You may have run into these terms before if you’re shopping for mortgages in Canada. But what do these actually mean - and which one is right for your situation?
Understanding the difference between these lender types is key to choosing the right mortgage for your needs. Whether you're a first-time homebuyer, self-employed, or dealing with bad credit, the type of lender you work with can affect everything from your interest rate to how quickly you get approved.
This is your traditional mortgage provider - think big banks and credit unions. They’re ideal for borrowers who have strong credit scores (typically 680+), as well as steady, verifiable income and a low debt-to-income ratio.
Working with an A Lender often means having access to the lowest mortgage rates, as well as longer amortization periods and insured mortgage options through CMHC. These lenders are perfect if your financial profile checks all the boxes.
That being said, A Lenders have strict criteria for being approved due to having specific requirements for income type and restrictions if you’re buying a unique property. Coupled with their slower processing times, this may not be the correct option depending on your goals.
If you don’t quite meet the bank’s requirements, B lenders (also known as alternative lenders or near-prime lenders) might be the next best choice. These lenders cater to borrowers with credit scores in the 600–680 range, self-employment income, and even recent credit issues.
B lenders offer more flexible qualification criteria, and their mortgage rates (while slightly higher than A lenders) are often still very competitive. From this, they’re a strong option if you need a bit more breathing room in the approval process without jumping all the way to private lending.
That being said, B lenders may require larger down payments, charge lender or broker fees, and come with higher interest rates than your A lenders.
Private mortgage loans offer flexibility and speed but require careful planning and due diligence. If you’re considering a private lender, I can show you your options at no cost. I have a trusted network of private lenders in Western Canada and am looking forward to showcasing how I can help.
