Burlington’s charm, with its waterfront views, tight-knit communities, and luxurious housing market, has not only attracted residents but also investors. Nevertheless, the city’s increasing demand for properties has made it very difficult for many buyers to own a home. Traditional banks usually provide services to borrowers with regular incomes and long credit histories; therefore, others are looking for flexible options. Burlington private lenders have, to a great extent, solved this problem by bringing in quick and customized mortgage solutions that not only facilitate residents but also investors in reaching their real estate aspirations.
What Makes Burlington’s Private Mortgage Market Unique
In Burlington, private mortgage lenders cater to a diverse array of clients, including investors, house flippers, and homeowners who need quick cash. Private lenders, unlike banks, prioritize the property’s value, location, and loan-to-value (LTV) ratio over income verification and credit score reports. This methodology enables borrowers with substantial home equity or non-traditional sources of income to be eligible. The Toronto Regional Real Estate Board (TRREB) reports that the average price of a house in Burlington remains among the highest in the area, frequently hovering near the million-dollar threshold. Hence, a significant number of homeowners have substantial equity and are therefore well-qualified for private mortgage loans that are processed more quickly and have fewer restrictions.
Why Homeowners Turn to Private Lending
Timing is decisive in the competitive housing market of Burlington. Houses in highly sought-after locations, such as Aldershot and Roseland, typically sell within just a few days. Waiting several weeks for traditional mortgage approval can be a significant reason for buyers to lose such opportunities. However, on the contrary, private lenders have the capacity to accept and finance loans within a few days, allowing buyers to act exceptionally quickly when a desirable property becomes available.It’s a common practice among private lenders; they also offer refinancing, second mortgages, and so on. These types of loans are not only meant for high-rate debts but also for backing taxes, home renovation, and other expenses. The Financial Consumer Agency of Canada (FCAC) emphasizes that borrowers should be educated on the repayment conditions as well as the various ways to use private loans, which are intended for short-term use only, as they are not suitable for long-term solutions.
Mortgages from Private Lenders: A Flexible Alternative
When seeking mortgage financing in Burlington, one typically has three tiers of lenders to consider:
- A Lenders- Banks represent this category of lenders. Mortgage approval can be quite rigorous. Lenders routinely subject applicants to tough mortgage stress tests to determine eligibility. Tighter mortgage stress rules as of June 1, 2021, have increased the difficulty of obtaining mortgage financing. Banks also prefer to use easy-to-calculate, substantial household income when approving mortgage loan parameters.
- B lenders- Credit unions and trust companies comprise this category of lenders. While not quite as stringent as the banks when determining mortgage loan approval, these lenders still expect to see a credit score of at least 550 and above and prefer traditional, substantial yearly household income.
- C Lenders- Private lenders make up the final category of lenders. Private lenders are often sought after by borrowers with poor credit, as they can look beyond credit scores by assessing other criteria.
Reasons for Needing a Private Mortgage in Burlington
Private lenders are lenient and often only require the reason for the loan for record-keeping. Some typical reasons among the residents and businesses in Burlington include:
- Paying off high interest credit card debt
- Financing university or college tuition
- Funding home repairs or renovations
- Stopping a power of sale or foreclosure
- Managing living expenses after job loss
Private lenders accommodate borrowers rejected by banks, regardless of reasons or financial status, providing an alternative avenue for financing.
Costs Involved in A Private Lender Mortgage
Private mortgage lenders are more expensive than any other type of mortgage lender. There are no standard costs, but most lenders try to offer rates and fees that are competitive with other lenders. Here are some costs to expect as of December 2024:
- Interest Rates: Typically between 8% and 12%
- Lender Fees: Usually between 2% and 4%
- Broker Fees: Set to match the lender fees, which are usually 2% to 4%
- Appraisal Fee: $500 + HST for single-family homes in Ontario. Larger or unconventional properties will cost more.
- Legal fees: These range from $1,000 to $3,000, depending on the mortgage request.
The Role of Loan-to-Value (LTV) Ratios in Burlington
Loan-to-value ratios (LTVs) are the primary factors that not only determine but also dictate the borrower’s eligibility and the terms of the loan. The LTV ratio indirectly indicates the risk associated with the lender by showing the relation between the loan amount and the property’s appraisal value. In Burlington, the amount funded by private lenders is based on property conditions and the exit strategy, with a maximum of 75% to 80% of the property value.
Let’s say a Burlington resident with a property worth $1 million decides to take out a loan of $600,000. In this case, his LTV stands at 60% which is deemed as a less risky situation by most private lenders. When LTVs are lower, the loan terms are generally better, so, in the case of high ratios, conditions will be stricter. To understand the property value side of the equation and support their LTV negotiations, homeowners are advised to review the City of Burlington’s assessment information, provided by the Municipal Property Assessment Corporation (MPAC).
Understanding Fees and Costs in Private Mortgages
In Burlington, private lending typically offers a more expensive option than traditional mortgages. The additional costs may take the form of lender and broker fees, appraisal charges, and legal expenses, which are typically deducted from the principal loan amount. Borrowers should demand a thorough fee explanation before signing the agreement.
GIS-based property assessments can be supported by local appraisal companies, such as Antec Appraisal Group in Burlington, which offer assessments of residential and investment properties in the area. If private loans are strategically positioned, they can provide rapid cash flow and, at the same time, secure equity during the financial transition. Please see the below chart for Burlington Pricing (matches our published Lending Guidelines & Pricing)
Reference: Mortgage Broker Store – Lending Guidelines & Pricing
| Burlington LTV Band (Halton Region) | Interest Rate Range | Combined Lender + Broker Fee | Notes |
| Up to 55% LTV | 7.50% – 8.00% | 3.75% – 4.00% | Best pricing for well-maintained freehold properties. Burlington resale demand is strong and risk is lower than the average Ontario suburban market. |
| 56% – 65% LTV | 9.75% – 10.25% | 5.50% – 5.75% | Typical band for refinances, debt payouts, and equity withdrawals. Borrowers generally have stable equity positions compared to the provincial average. |
| 66% – 70% LTV | 11.00% | 6.00% | Used when exit strategies require more documentation or when the property type carries above-average risk. Condos may receive added scrutiny based on governance and financial reporting. |
| 71% – 75% LTV (Typical max) | 11.75% – 12.25% | 6.00% | Requires a clearly supported exit plan. Properties with slower-than-average marketability or weaker condo status certificates may not qualify at this level. |
What You Need to Know About Fees
Your mortgage amount includes specific fees, such as lender, broker, and legal, which are included in your mortgage amount and count toward the LTV. If your request is already at 75% LTV before fees are added, you might exceed the limit and not get approved. Appraisal fees are typically not included in the LTV and are paid by the borrower directly after the inspection is performed.
A good mortgage broker will provide documents that clearly outline all costs related to the mortgage, and whether or not they are included in the mortgage amount. Reviewing the costs with your broker is always a good idea to make sure they fit your financial plan.
When applying for private mortgage lenders in Ontario, you must state why you need the money. Private lenders are usually lenient and will accept the most reasonable responses.
Burlington’s Real Estate Trends and the Rise of Private Financing
Burlington’s housing market is still robust and invigorated by its proximity to Toronto, in addition to its popularity in its waterfront and suburban areas. Data from various local sources, such as Zolo’s Burlington Housing Market Trends, indicate that the price of real estate is increasing continuously, particularly for detached houses and lakefront properties. At the same time, the number of listings has increased slightly, giving buyers a bit more room to choose while still being in a competitive situation.
All these aspects make Burlington a good market for private lending. The homeowner and the investor are obtaining private mortgage loans for the readily available funds, whether it is for renovation, short-term flips, or leveraging the money they already have in the property. Because Burlington’s market is a secure and high-value one, private lenders consider it a safe investment opportunity.
How to Choose a Private Lender in Burlington
It is essential to deal with a credible and licensed lender. One way for borrowers to verify credentials is through the FSRA’s public registry of licensed mortgage brokerages, brokers, and agents in Ontario. Another way is to utilize the FSRA Mortgage Professional search tool, which ensures that the broker you are dealing with is properly regulated. It’s important to mention that private lenders themselves do not have to be licensed unless they operate as a brokerage. Borrowers deal with licensed brokers/agents.
When comparing lenders, your emphasis should be on the total borrowing costs, rather than just the interest rate. Inquire about the renewal fees, prepayment penalties, and what will happen when the loan term ends. Good lenders are honest about these things and even suggest that clients seek independent legal advice before the closing. For real estate law services, homeowners in Burlington can contact local firms such as Cass & Bishopor or RealEstateLawyers.ca.
With property values steadily climbing and the borrowing requirements of the traditional banks still being very strict, private mortgages have become a versatile solution for homeowners, buyers, and investors. It is essential to understand loan-to-value ratios, assess total borrowing costs, and have professionals with the highest reputation on your side to use private financing responsibly.
Highly-Rated Local Professionals (Burnlington)
Real-estate lawyers (refiannce/purhcase/sale)
- LawDen – rated lawyer offering residential real-estate closing and notary service.
- Li Cheng Law – local lawyer with strong reviews and fixed closing fee structure assisting with purchases, sales, refinancing, and title transfers
- Cass & Bishop – long-established Burlington law firm providing residential and commercial real-estate legal services
Appraisers (AIC-designated, Burlington)
Home inspectors (Burlington)
- Cherry Home Inspections – Burlington inspector noted for expertise and infrared/WETT capabilities with strong client testimonials.
- Carson Dunlop Home Inspection – one of Canada’s longest-running home inspection companies, providing detailed buyer/seller reports.
- A Buyer’s Choice Home Inspections – comprehensive home inspection services with positive client experiences reported