Lending Guidelines & Pricing
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We are a direct private lender based in Ontario, and we have been arranging and funding private mortgages here since 2008. This page lays out exactly how we lend: what we lend on, how much, at what loan-to-value, and what it costs. We would rather you know our guidelines up front than find out halfway through an application.
We keep our lending deliberately simple. We lend against residential single-family homes in Ontario, in first and second position, based on the equity in the property rather than your credit score or income. If your situation sits outside the lines below, ask us anyway. We review exceptions case by case, and plenty of the files we fund started with a phone call about something that did not quite fit.
The short version
Exceptions reviewed case by case
Lower in Brampton, rural, and slower-sale markets
No rate premium for power-of-sale files
Single-family homes only
What our private mortgages cost
Private mortgages cost more than a bank mortgage, and we will not pretend otherwise. Our interest rates generally run between 8% and 12%, and the rate you get depends mostly on the loan-to-value: the closer you push toward our maximum LTV, the more risk we take, so the rate and lender fee go up. On top of interest there is a lender fee. For direct borrower inquiries, Mortgage Broker Store Inc. charges a broker fee that is equal to the lender fee. The lender fee and broker fee together never drop below $3,500. If the inquiry involves a power-of-sale property or another active legal proceeding, the lender fee increases by 2%. There is no interest-rate premium for power-of-sale properties.
First mortgage rates by loan-to-value
Indicative interest rate and lender fee on a first mortgage, based on the loan-to-value of the property.
| LTV | Interest Rate | Lender Fees |
|---|---|---|
| Up to 55% | 8.49% | 2% |
| Up to 65% | 9.49% | 2.25% |
| Up to 70% Most common | 10.49% | 2.5% |
| Up to 75% | 11.49% | 3% |
Most of our first mortgages land near 70% LTV. A higher LTV means more risk for the lender, so the rate and lender fee move up with it. For direct borrower inquiries, Mortgage Broker Store Inc. charges a broker fee that is equal to the lender fee. The combined lender and broker fee has a $3,500 minimum.
Second mortgage rates by loan-to-value
Indicative interest rate and lender fee on a second mortgage. The percentages are the combined loan-to-value: your existing first mortgage plus this one, against the property value.
| LTV | Interest Rate | Lender Fees |
|---|---|---|
| Up to 60% | 10.49% | 2.5% |
| Up to 70% Most common | 11.49% | 3% |
| Up to 75% | 11.99% | 3% |
A second mortgage sits behind your first, so if anything goes wrong the first lender gets paid before us. That extra risk usually means a higher rate and lender fee than a first mortgage. For direct borrower inquiries, Mortgage Broker Store Inc. charges a broker fee that is equal to the lender fee. The combined lender and broker fee has a $3,500 minimum.
These tables are a guide, not a quote. Your actual rate and lender fee come out of a full review of the property, the equity, your mortgage position, and the rest of the file. The tables list lender fees only. For direct borrower inquiries, Mortgage Broker Store Inc. charges a broker fee that is equal to the lender fee; together they are subject to the $3,500 minimum. Power-of-sale properties add a 2% premium to the lender fee only, with no interest-rate premium.
What we will and will not lend on
Here is the short version of what fits and what does not. We lend on one kind of property on purpose: ordinary residential single-family homes. That focus is part of how we keep approvals fast and our pricing honest.
What we lend on
What we do not do
How far we lend by location
How much we lend against a home depends on where it is. The reason is simple. If a mortgage ever goes into default, a house in a busy city sells quickly, while a rural property can sit on the market for months. The slower a property is to sell, the less we are willing to lend against it.
Up to 75% LTV
Up to 65% LTV
Up to 50% LTV
A few exceptions to the numbers above:
- Very rural homes on a well and septic, or that are not winterized, are strictly case by case, and the workable LTV can come in lower than the figures here.
- If there is an upcoming eviction, we may lend up to 5% past the normal maximum, but only when the property is already listed for sale on MLS with a licensed agent at the time of funding.
- Luxury homes valued above $1.8 million: we take 10% off the maximum LTV for the location, so a city home that would normally cap at 75% caps at 65%. The pool of buyers thins out at that price, and a slow sale is the risk we price for.
- Condo units under 500 square feet: the same 10% reduction applies. Small condos are the first thing to stall when the market slows, so we leave more room.
General lending parameters
The rest of the details, in one place.
- Minimum loan: $30,000
- Maximum loan: $500,000. We review larger files case by case.
- Current market value: at least $200,000, based on an appraisal that is 30 days old or newer
- Appraisals: the appraisal company must be on the Home Trust or Equitable Bank approved appraiser list, or we cannot accept the report. Our own approved appraiser list has firms we work with regularly.
- Mortgage term: usually 1 year
- Renewals: at our discretion, as long as the home is in good condition and the loan-to-value is still within our maximum
- Lending area: Ontario only
- Security: every loan is a mortgage registered against real estate
Costs you pay outside our rate and fees
- Application fee: $375
- Appraisal: paid up front by you, directly to the appraisal company. It usually starts around $600 plus HST and varies with the property.
- Legal: roughly $1,500 to $3,000, covering both the lender’s lawyer and your own independent legal advice. You pay the lawyers directly, not us.
All rates, fees, terms, and programs can change without notice and are subject to underwriting approval.
How we structure approvals
Purchase financing
If you are buying and the down payment is the sticking point, we may still have options. We consider down payments that come from:
- Equity from another property
- A gift of equity, including non-arms-length deals
- Borrowed funds
- A builder’s credit
- Accumulated rent credit
- Sweat equity
- Bridge financing
- A vendor take-back or secondary financing behind our mortgage
Flexible terms
- Term lengths: mostly 1-year terms, with renewal possible
- Payments: interest-only or amortized, depending on the file
- Corporate borrowers: considered, usually with a personal guarantor
- Complex files: this is the work we do most, for borrowers who do not fit a bank’s boxes
What people use our mortgages for
Most of our files are one of these:
- Purchase or refinance
- Equity take-out
- Bridge financing
- Debt consolidation
- Home renovations
- Mortgage, condo, or property tax arrears (often paid from the proceeds)
- Power of sale or foreclosure situations
- CRA arrears
- Collateral or blanket mortgages
- Title transfers
- Paying out a consumer proposal or bankruptcy
- Spousal buy-out
- Discharging liens or judgments
- Rent-to-own purchase financing, carefully structured
Who we work with
Because we lend on equity rather than credit and income, we can help people the banks turn away. We have no minimum credit score, no formal income verification, and no maximum debt-service ratios. We do still need real equity in the property and a sensible way out of the loan at the end of the term.
We regularly fund borrowers who are:
- Self-employed or earning unconventional income
- Dealing with bruised credit, collections, or unsecured debt
- Undischarged bankrupt (with trustee permission) or recently discharged
- In an open consumer proposal
- Behind on income taxes, CRA, or property tax and mortgage payments
- Owners of more than one property
One honest caveat: a private mortgage is not always the right move. If the numbers do not work, or you would be better off selling, we will tell you. If you are not sure whether your property or situation fits, call Jonathan at 416-499-2122 or email jonathan@mortgagebrokerstore.com, and we will tell you plainly whether a first or second mortgage makes sense for you.
Rates, fees, lender requirements, and lending guidelines are subject to change without notice. All mortgage applications are subject to lender approval and verification. Published information is intended as a general guide only and may not reflect all available lending options.
Lending guidelines and pricing FAQ
Straight answers to the questions we get most about how we lend.
How much can I borrow?
Our standard maximum is $500,000, and we review larger files case by case. The actual amount is also limited by the home’s value and our loan-to-value cap for that location, which runs from 75% in major centres down to 50% in very rural areas.
What kind of property do you lend on?
Residential single-family homes in Ontario with a current market value of at least $200,000, based on an appraisal that is 30 days old or newer. We do not normally lend on commercial property, farms, multi-unit residential, or raw land, though we will look at exceptions case by case. We cannot lend on reserve land, leased land, trailers, or mobile homes at all, and we cannot fund major renovation projects (repairs under $100,000 are fine, a full gut or rebuild is not).
How is a second mortgage priced differently from a first?
A second mortgage sits behind your existing first mortgage, so if anything goes wrong the first lender gets paid before us. That extra risk usually means a higher rate and fee than a first. We base it on the combined loan-to-value, up to 75%.
Why is the maximum LTV lower in rural areas, Brampton, Thunder Bay, and Windsor?
If a mortgage goes into default, a home in a busy city sells quickly, while a rural or slower-market property can sit for months. We lend less against properties that are harder to sell, so rural areas plus Brampton, Thunder Bay, and Windsor cap at 65%, and very rural communities under 10,000 people cap at 50%. Luxury homes valued above $1.8 million and condo units under 500 square feet also get 10% taken off the maximum for their location.
What does a private mortgage actually cost?
Interest is usually 8% to 12%. The tables list lender fees only. For direct borrower inquiries, Mortgage Broker Store Inc. charges a broker fee that is equal to the lender fee, with a combined minimum of $3,500. You also pay for the appraisal (about $600 plus HST and up) and legal work (roughly $1,500 to $3,000 for the lender’s lawyer and your independent legal advice). Power-of-sale properties and other active legal proceedings add 2% to the lender fee only. There is no interest-rate premium for power-of-sale properties.
Can I use my own appraisal?
Only if the appraisal company is on the Home Trust or Equitable Bank approved appraiser list and the report is 30 days old or newer. If your appraiser is not on either list, we will need a new appraisal from one that is before we can fund.
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