Buyer's Guide · 2026

Private Mortgage Lenders Ontario: How to Choose the Right OneFees, Reputation & Red Flags

A framework for evaluating private mortgage lenders Ontario borrowers actually get placed with — what to look for in private lending Ontario deals, what to avoid, and how private lenders differ from B-lenders when a bank has said no.

Quick read: The right private mortgage lender in Ontario isn't the one with the lowest rate — it's the one with a clean Form 1.1, an FSRA-licensed brokerage, transparent fees (1%–2% lender + 1%–2% broker), and a track record of fair renewals. Rate alone is a trap.

The 7-Point Evaluation Framework

Criterion	Why It Matters	Weight
FSRA licence	Confirms the brokerage is regulated and accountable. Search FSRA's public registry.	Non-negotiable
Total cost of borrowing	Rate + lender fee + broker fee + legal. A 7.99% rate with 3% fees can cost more than 8.99% with 1%.	High
Form 1.1 disclosure	Ontario-mandated commitment showing every fee and cost before you sign. Refuse verbal quotes.	Non-negotiable
Renewal & discharge history	Ask the broker how the lender handles renewals, discharges, and defaults. Reputation matters more than rate.	High
Prepayment terms	Ontario norm is 3 months interest. Anything harsher signals a lender who wants you locked in.	High
Property fit	Some MICs specialize in urban GTA; others fund rural, mixed-use, or construction. Match the lender to your file.	Medium
Source of capital	MICs and institutional syndicates are more predictable than single individual lenders on renewal.	Medium

Understanding Lender Fees

Fees are where private mortgages hurt when they're mispriced. Ontario norms for a well-structured 1st or 2nd private mortgage:

Lender fee: 1%–2% of the loan amount, deducted from proceeds at closing. Institutional MICs sit at the low end; individual lenders sit higher.
Broker fee: 1%–2% of the loan amount. Larger, cleaner files (1st mortgages, low LTV, urban) command the lowest broker fees.
Legal fees: $1,500–$3,000 for lender counsel plus your own lawyer. Complex title work adds cost.
Appraisal: $400–$600 for residential, $1,500+ for commercial or unique properties.
Renewal fee: Typically 1% at each renewal. Confirm in writing before signing the initial term.

Private Lender vs B-Lender

Factor	Private Lender	B-Lender
Regulator	Brokerage licensed by FSRA; lender itself often unregulated	OSFI or provincial regulator; institution-level oversight
Qualification basis	Property equity + exit strategy	Income, credit, and equity — with stress test
Typical rate (2026)	7.49% – 11.49%	5.49% – 7.49%
Lender fees	1% – 2% of loan	0% – 1% of loan
Speed to fund	5–10 business days (48 hrs rush)	2–4 weeks
Term length	6 – 24 months, interest-only common	1 – 5 years, amortized
Best use	Bridge, bank-declined, urgent capital	Self-employed with docs, bruised credit, non-conforming income

Rule of thumb: try A-lender first, B-lender second, private third. Private is a bridge — most borrowers exit to a B or A lender within 12–24 months.

How to Vet Reputation Before You Sign

Search the brokerage's FSRA licence number on the FSRA public registry — confirm it is active and not under enforcement.
Ask the broker for two recent borrower references who have completed a full term with the lender.
Search the lender's name and 'CanLII' for any Ontario Superior Court power-of-sale or lender-conduct decisions.
Review Google reviews for the brokerage — pay attention to complaints about renewal treatment, not just funding speed.
Confirm the lender has funded at least 50 files in the last 12 months in your property's region.

Red Flags

Verbal rate quotes without a Form 1.1 commitment letter
Lender fees above 3% of the loan amount
Prepayment penalties beyond 3 months interest
Pressure to sign within 24 hours without independent legal review
No FSRA brokerage licence number on the commitment
Renewal terms that are 'to be determined' rather than disclosed up front
Fees payable directly to the lender or broker before closing

FAQs

What is a private mortgage lender in Ontario?

A private mortgage lender is an individual, syndicate, or Mortgage Investment Corporation (MIC) that lends against real estate outside the federally regulated bank channel. In Ontario, private mortgages are arranged through FSRA-licensed brokerages and are equity-based rather than credit-and-income based.

How do I choose a private mortgage lender in Ontario?

Compare lenders on four things: total cost of borrowing (rate + lender fee + broker fee), reputation and FSRA licensing, the clarity of their Form 1.1 commitment, and their track record of renewing or discharging on time. Never pick a private lender on rate alone — the cheapest quote often carries the highest fees.

What is the difference between a private lender and a B-lender?

B-lenders (Home Trust, Equitable Bank, MCAP-alt, etc.) are federally or provincially regulated institutions that still require income documentation, credit review, and a stress test — just with looser guidelines than the Big 6. Private lenders skip the stress test entirely and qualify almost exclusively on property equity, exit strategy, and marketability.

What fees should I expect from an Ontario private lender?

Standard Ontario pricing is a 1%–2% lender fee, 1%–2% broker fee, $1,500–$3,000 legal, and $400–$600 appraisal. All fees must be disclosed in writing on the Form 1.1 commitment before you sign. Anything above 3% lender fee is outside the Ontario norm and warrants a second opinion.

Are private mortgage lenders regulated in Ontario?

Private lenders themselves are largely unregulated, but the brokerages that arrange private mortgages must be licensed by the Financial Services Regulatory Authority of Ontario (FSRA). Always verify the FSRA licence number of the brokerage placing your file — it is your primary consumer-protection layer.

How long does a private mortgage take to fund in Ontario?

A clean file typically funds in 5–10 business days from signed commitment. Urgent bridge deals can close in 48–72 hours when appraisal, title, and legal are pre-arranged. Timing depends more on your lawyer and appraiser than on the lender.

Want a shortlist matched to your file?

We compare offers across 80+ Ontario private lenders and MICs and present the top three with full Form 1.1 disclosure. FSRA #10874.

Explore Private Mortgages See Current Rates

Private lending Ontario — related searches

These are the exact questions borrowers bring us: private lending Ontario costs, private mortgage lenders Ontario shortlists, bridge financing Canada timelines, and local files like private mortgage Burlington or a bridge loan lender in Hamilton.

Private Mortgage Lenders by City

Local private lending Ontario pages with city-level LTV limits, rates and funding timelines.

Not on the list? See every Ontario city we serve.