Alternative Mortgage Lenders in Canada

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Alternative mortgage lenders include private mortgage lenders and B-lenders. If you’ve been denied a mortgage at a bank, don’t meet their strict lending requirements, or need customized terms, alternative mortgage lenders can help provide financing to fit your situation.

How can an alternative mortgage lender help me?

Failing the stress test will mean that either you can’t get your first mortgage from main lenders or if you already have a mortgage you will be stuck at your current mortgage lender, even if their rates are not competitive compared to other lenders. An alternative mortgage lender is not required to conduct a mortgage stress test. These alternative lenders are more lenient in who they will lend a mortgage to, and can help you out when traditional lenders won’t.

This can allow you to get financing for your mortgage even if you have a bad credit score, a low income or unstable employment income, or a high level of debt.

List of Alternative Mortgage Lenders

Mortgage TypeExample Lenders
Private Mortgages
Canadalend
Clover Mortgage
nuborrow
Alpine Credits
Cannect
For a full list of private lenders, visit our private mortgage lenders page or our private mortgage rates page
B-Lenders
MCAP
First National
Home Trust
For a full list of B-lenders, visit our B-lenders page.
Bridge Loans
RBC
TD
Scotiabank
BMO
CIBC
and other Credit Unions and Mortgage Brokers
Reverse Mortgages
Equitable
Home Equity Bank
Construction Loans
RBC
TD
and other Private Lenders and Mortgage Brokers
Second Mortgages
RBC
TD
Scotiabank
nuborrow
Canadalend
Alpine Credits
and other Private Lenders and Mortgage Brokers

Types of Alternative Mortgages

Private Mortgages

Private mortgages are lent out by private investors, rather than by a bank or credit union. They are not regulated by the government, which means that they can lend out to risky borrowers. To make up for this, private lenders usually charge higher interest rates and fees. You can access private lenders through mortgage brokers.

A private mortgage lender is often a last-resort option for homeowners. They mainly require you to have home equity rather than a sizable income or credit score. Private mortgages have short terms, with most being less than one or two years (e.g. 6 months).

A private mortgage can give you time to get your financial situation back on track in order to transition back to a traditional mortgage lender with lower interest rates at the end of your term. Making on-time mortgage payments, building up your credit score, and paying down debt during this time can help you qualify for a traditional mortgage.

B-Lender Mortgage

B-Lenders are a step-up from private lenders as they can offer lower rates but they also have more stringent requirements. B-Lenders mainly deal with CMHC insured mortgages, which means that they have requirements such as a minimum credit score and maximum debt service levels.

B-Lenders can offer mortgages with features such as requiring only interest payments or allowing non-conventional income sources, such as being self-employed.

Bridge Financing

If you are in the process of purchasing a home but haven’t sold your current home yet, you might need financing to pay for the mortgage down payment of the new home. Bridge loans allow you to receive money to cover the down payment while you wait for money from the sale of your home. Bridge loans are usually for a few months and can allow you flexibility when purchasing a home without pressure to immediately sell your existing home.

Bridge gap loans are offered by traditional lenders, such as banks, as well as private lenders.

Ontario Lic. #13115

Reverse Mortgage

A reverse mortgage provides you a steady stream of cash, rather than you having to make mortgage payments to the lender. Reverse mortgages are offered only to those over 55 years old in Canada. They do not require you to make monthly mortgage payments and they also don’t require you to have any income.

A reverse mortgage allows retirees to supplement their income during retirement by unlocking the equity in their home without needing to sell their home. The reverse mortgage and accumulated interest will only be paid back once the borrowers sell the home, move, or pass away.

Construction Loans

A construction loan provides temporary financing for you to have a home constructed from the ground up. Some construction loans required interest-only payments. Once the loan expires, construction loans can be extended, paid back in full, or rolled over into a mortgage.

Second Mortgages

A second mortgage allows you to borrow more money when you already have an existing mortgage. Second mortgages are based on the equity that you have. Higher home equities will allow you to borrow more money.

Second mortgages include home equity loans and home equity line of credits (HELOC).

The calculators and content on this page are provided for general information purposes only. WOWA does not guarantee the accuracy of information shown and is not responsible for any consequences of the use of the calculator.