Turned down by a bank? There are still legitimate options

Who this is for

• Bruised credit - past collections, a consumer proposal, or a discharged bankruptcy that banks won't look past yet.
• Bank turndowns - declined over income documentation, debt ratios, or the property itself.
• Self-employed borrowers whose tax returns don't reflect what they actually earn.
• Unique properties - rural, mixed-use, or multi-unit homes that some lenders simply avoid.
• Time pressure - a closing date or a maturing mortgage that won't wait for a slow approval.
• Newcomers to Canada with a thin credit file but solid income and down payment.

Many of my private-lending clients graduate to a traditional lender when their term is up - private is usually a bridge to get you there, not the final stop.

Alternative vs. private: what's the difference?

People use these terms interchangeably, but they're different tiers. Alternative lenders (sometimes called B lenders) are established institutions that work with borrowers who just miss traditional bank guidelines - bruised credit, stated income, higher debt ratios. Their rates run higher than the banks, but well below private lending. Private lenders are individuals or mortgage investment companies lending their own funds. They're faster and more flexible - they'll consider situations no institution will touch - but they're the most expensive option. We work with both, and part of the honest assessment is telling you which tier you actually need.

The cost, honestly

Private mortgages cost more than bank mortgages. That's not a sales tactic - it's the nature of the product: the lender is taking more risk, for a shorter term, on a borrower the banks declined. Expect higher interest than a traditional mortgage, a lender fee (often calculated as a percentage of the loan amount), legal fees, and sometimes a broker fee depending on the mortgage.

Here's the part that matters: every fee and the interest rate must be disclosed to you in writing before you commit. That's the law in Ontario, and it's how we operate regardless. We'll walk through each line so you know exactly what the financing costs. If anyone quotes you a private mortgage without putting every fee in writing - walk away.

When private lending makes sense - and when it doesn't

It makes sense when…

• There's a short, solvable problem: one more year of clean credit history, business income that's stabilizing, a property quirk with a clear fix.
• You need to close on a date a traditional lender can't meet, and the exit plan is already in motion.
• The alternative is worse - losing a home with real equity, or a power-of-sale situation with no time to wait.

It doesn't when…

• There's no plausible exit strategy. Renewing private-to-private at high rates, year after year, erodes your equity - that's a debt trap, not a plan.
• The payments would leave you worse off than your alternatives, including selling.
• You're being rushed to sign without written disclosure of every cost. (See above: walk away.)

If your situation has a fixable credit or income story, a short-term private mortgage can be the bridge that gets you there. If it doesn't, we'll tell you - and talk through what would work instead, whether that's a traditional refinance once the numbers improve, or a different strategy entirely.

What our clients say