Private Mortgage in Toronto, Based on Your Home Equity
A private mortgage is a loan secured on your home that is decided mainly on the equity in the property, not on whether you pass a bank's income and credit tests. Equity Rich lends directly on GTA homes, so if your bank said no, or can't move fast enough, we look at what your home is worth and what you owe on it, and tell you plainly what we can do. Credit is reviewed, but your equity carries most of the weight, and income proof is optional: you can borrow up to 80% of your home's value, subject to approval, with funds in days once approved.
What a private mortgage is, and when it makes sense
A private mortgage is registered on your property’s title like any other mortgage. The difference is who lends and how they decide. A bank starts with your income, your credit score and its debt-service ratios. An equity-based lender starts with the property: its value, its condition, and how much equity sits behind any mortgage already on it.
It usually makes sense when:
- Your bank turned you down because your income is hard to prove on paper, even though you can pay.
- Your credit took a hit (missed payments, a consumer proposal, collections) and you need money before it recovers. If your bank turned you down because of your credit, see our guide to bad credit mortgages in Toronto.
- You owe property tax arrears or CRA debt, or you’re behind on your mortgage and need to settle it now. If a lender has started a power of sale, see power of sale in Ontario.
- You need bridge money between buying and selling. See bridge mortgages.
- You want to roll high-interest debt into one payment. See debt consolidation mortgages.
It’s a short-term tool. If a bank or a B lender will give you what you need at their price and on your timeline, that is usually the cheaper route, and we’ll tell you so.
How Equity Rich lends
We’re a direct, equity-based lender first, so the decision is made on your home and your plan. Here is what we look at:
- The property. Its appraised value, type and location in the GTA.
- Your equity. The value minus what’s already registered on title.
- Your plan to repay. How the loan ends: a refinance, a sale, or a change in your income.
- Equity first. We review your credit and income proof is optional, but the decision rests mainly on the property, your equity and your plan to repay.
Where a partner lender can offer better pricing or a structure we don’t carry, our brokerage access lets us place the mortgage there instead. You deal with one team either way.
Example only: a Scarborough home appraised at $1,100,000 with $550,000 left on the first mortgage has $550,000 of equity. Up to 80% of the home’s value is $880,000; less the $550,000 first mortgage, that leaves up to $330,000 to borrow, subject to approval. We confirm the exact amount in writing after the appraisal.
We can lend in first position (replacing or as your only mortgage) or second position (behind your current mortgage). If you want to keep your first mortgage and its rate, a second mortgage is often the better fit. For a lump sum against your home more generally, see home equity loans.
Who a private mortgage suits
- Self-employed owners whose tax returns show less than they earn. See self-employed mortgages.
- Homeowners with bruised credit who have real equity and a plan to rebuild.
- Retirees and people on fixed income who own most of their home but can’t meet a bank’s ratios.
- Newcomers without a long Canadian credit history.
- Anyone on a deadline: tax arrears, a closing date, a separation buyout, a lender demand.
Costs and fees, explained
A private mortgage costs more than a bank mortgage. The lender takes on a file the bank wouldn’t, for a short term, so the price reflects that risk. Here is what usually makes up the cost:
- Interest rate. Higher than a bank’s rate for a fully qualified borrower. It depends on the loan-to-value, the property, the position (first or second) and the term. Payments are often interest-only, which keeps the monthly amount down but doesn’t reduce what you owe.
- Lender fee. A one-time fee for setting up the loan, often taken from the funds at closing.
- Appraisal. An independent valuation of the home.
- Legal fees. A lawyer registers the mortgage on title and handles the closing.
- Renewal or extension fees, if you need more time at the end of the term.
We quote the rate, lender fee and term in writing before you commit, so you can compare the full cost, not just the rate. Ask any lender for the total cost of borrowing over the whole term.
Term length and your exit plan
Private mortgages are short. Terms are commonly around 12 months, sometimes open so you can repay early. Because the term is short, the most important question is how the loan ends. We talk through the exit with you before you sign:
- Refinance back to a bank or a B lender once your credit recovers, your arrears are cleared, or two years of self-employed income are on paper.
- Sell the property, when the mortgage was bridge money or a buyout.
- Renew for another term, if the plan needs more time. This costs more, so we’d rather plan for it than be surprised by it.
The risk to know: a private mortgage is secured on your home. If the term ends and there’s no exit, or payments stop, the lender can enforce the mortgage. A clear, realistic exit plan is what keeps a private mortgage a bridge and not a trap.
Private lender vs bank vs B lender
| Bank (A lender) | B lender | Private / equity-based lender | |
|---|---|---|---|
| Decides mainly on | Income, credit, stress test | Income and credit, with more flexibility | Property and equity |
| Best for | Strong, provable income and good credit | Near-miss files: recent credit issue, newer self-employment | Bank and B lender said no, or the timeline is too tight |
A B lender is often the step between a private mortgage and a bank: many homeowners use a private mortgage now and refinance to a B lender or a bank once the problem is fixed. See also alternative mortgage lenders.
How the process works
A short call
You tell us what you need the money for, what the home is worth roughly, and what you owe on it.
Application and documents
Usually proof of ownership, your latest mortgage statement, property tax bill and ID. We’ll tell you if your file needs more.
Appraisal and title search
These confirm the value and what’s registered on the property.
Written offer
The amount, rate, fees, term and payment, in writing. Take it to your lawyer and ask questions.
Signing and funding
Your lawyer registers the mortgage and the funds are paid out, often straight to the debts you’re clearing.
How long it takes depends on the appraisal, the title search and the lawyers. If you’re facing a deadline, tell us on the first call.
Private mortgages across the GTA
We lend on homes in Toronto and across Durham, York, Peel, Halton and Hamilton. Local pages: Oakville, Richmond Hill, Vaughan, Markham, Mississauga, Aurora, Brampton and Ajax.
Quick Facts
- Max LTV Up to 80% combined, subject to approval
- Credit Check Reviewed
- Funding Speed In days, once approved
Ready to Get Started?
Approval is based mainly on your home equity. Credit is reviewed, and income proof is optional.
Get Free Assessment +1-647-930-9738Other Services
- Alternative Mortgage Lenders
- Bad Credit Mortgages in Toronto
- Bridge Mortgage
- Commercial Mortgage
- Debt Consolidation Mortgage
- HELOC
- Home Equity Loans
- Interest-Only Mortgage
- Investment Property Mortgage
- No Income Mortgages
- Power of Sale in Ontario: Your Options
- Residential Mortgage
- Retirement Mortgage
- Reverse Mortgages
- Second Mortgages
- Secondary Suite Mortgage
- Self-Employed Mortgage
- Spousal Buyout Mortgage
Private mortgage questions
Find out what your home can do for you
Tell us about your home and what you need. We'll look at your equity and give you a straight answer, including when a private mortgage isn't the right fit.