The Richmond Hill real estate market has captured the attention of the entire Greater Toronto Area due to its outstanding equity and exceptional demand. As a result, this scenario led both owners and investors to consider private mortgage lending as a faster route for acquiring money than going through conventional banks. Private lenders in Richmond Hill are an option for borrowers who may have difficulty obtaining standard financing due to their income profile, credit history, or timing issues. The value of the property is the main factor on which the decisions and the exit strategy are based.
What Are Private Mortgage Lenders and How Do They Differ
Private mortgage lenders can work with borrowers who irregularly earn money and primarily consider the property’s worth and the available equity, rather than income verification and credit scores, as the basis of their lending decisions. The Financial Services Regulatory Authority (FSRA) regulates mortgage brokerages, brokers, agents, and administrators, ensuring compliance within the mortgage brokering industry, while private lenders themselves are only regulated when operating through a licensed brokerage.
In Richmond Hill, lenders primarily assess repayment and the property’s value as collateral, rather than the borrower’s qualifications. Private loans are generally more expensive in terms of interest and shorter in duration, but they are also quicker in terms of approval, allowing access to both homeowners and investors.
Mortgages in Richmond Hill Versus Conventional Loans
Private lender mortgages in Richmond Hill are an alternative for people who turned down for conventional loans. Canadian banks are heavily regulated, while these private lenders don’t operate under the same government restrictions.
What’s more, their focus and the criteria they use to approve applications are different. Banks and more traditional institutions like credit unions place an emphasis on reliable income and credit scores. There’s usually a stress test involved, whereby applicants need to qualify at the five-year posted rate or two percentage points higher than the one offered by their broker or bank. The benchmark is the higher of the two.
Read on to find out how mortgages from Richmond Hill’s private lenders differ.
Private Lenders in Richmond Hill Loans
Private lenders in Richmond Hill are attracted to the area’s real estate due to the high price, appreciation and values. The minimum these lenders usually loan out is $30,000 or more on single-year terms as of 2024. That way, the property can be sold if the borrower fails to pay.
Reasons for a Private Mortgage
You’ll need to list the reasons for a private mortgage when you fill out the application. Some of the common answers include:
- Paying off credit card debts.
- Renovating a property or making repairs.
- Having a supplemental income after losing a job.
- Preventing a power of sale or foreclosure.
- Paying for college or university tuition.
Private lenders usually service applicants turned away by traditional banks and credit unions. Richmond Hill private lenders specialize in these difficult-to-place mortgages. A private lender mortgage can also improve your credit score.
How Loan-to-Value (LTV) Affects Terms in Richmond Hill
In Richmond Hill, private lenders are primarily focused on the Loan-to-Value (LTV) ratio that determines how much value you are borrowing against the property. This ratio compares the size of the loan to the value of the home. An LTV that is a lower percentage means the lender has less risk, which may lead to better conditions, such as lower interest rates. Imagine you take out a loan of $700,000. And let’s say the property is appraised at $1.4 million. In this case, the LTV is 50%, which is safer for the lender compared to an LTV of 80%.
A recent study indicated that a normal single-family home costs around $1.3 million, while a townhouse generally has a price tag of just below $700,000. The majority of private lenders are prepared to extend loans of around 75 to 80 percent of the property price. In some cases, they may even go beyond that if the borrower can demonstrate an excellent repayment plan. Lenders usually rely on local property appraisals to ascertain the actual value of the house before deciding on the amount they can lend without risk. Please see the below chart for Richmond Hill Pricing (matches our published Lending Guidelines & Pricing)
Reference: Mortgage Broker Store – Lending Guidelines & Pricing
| Richmond Hill LTV Band | Interest Rate Range | Combined Lender + Broker Fee | Notes |
| Up to 55% LTV | 7.75% – 8.25% | 4.00% | Best pricing on strong, marketable freehold homes. Richmond Hill properties in this band typically show stable resale demand and low lender risk compared to average Ontario markets. |
| 56% – 65% LTV | 10.00% – 10.50% | 5.25% – 5.50% | Standard tier for equity takeouts, arrears payouts, or general refinancing. Borrowers in this band usually have solid equity positions relative to average suburban markets. |
| 66% – 70% LTV | 11.25% | 5.75% | Used when the borrower’s exit plan involves multiple steps or when the property type carries above-average risk. Condos in this range may receive additional scrutiny due to variable governance quality. |
| 71% – 75% LTV (Typical max) | 12.00% | 6.00% | Requires a clearly documented exit strategy, such as a confirmed sale or refinance. Properties with slower-than-average marketability or weaker condo financials 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.
Some popular responses include:
- To pay off high-interest credit card debt
- To pay for home repairs or renovations
- To cover living expenses after a work layoff
- To stop a power of sale or foreclosure
- To pay tuition fees for college or university
In many cases, borrowers approach private lenders for mortgages and loans to help consolidate existing debt or prevent property loss through foreclosure or power of sale proceedings. Many people juggle multiple types of debt at once. For example, as noted above, you might have a mortgage and a significant amount of credit card debt or outstanding student loans. Since mortgage and student loans are owed to different collectors, you may have to keep track of multiple monthly debt payments. A mortgage from a private lender can be enough to pay off what remains on your mortgage and your student loans. Upon settling individual debts, you’ll have a monthly payment to your lender, simplifying your financial obligations. Many borrowers find this an easier way to manage debt.
People who cannot qualify for a low-interest rate loan at a bank are the kind of clients that private lenders seek out. Our private lender network can provide mortgages to people turned down by banks. Most private lenders will offer a rate between 8% to 12%.
Richmond Hill Real Estate
Richmond Hill is also close to other hubs in the GTA, including Markham, Vaughan, New Market and Scarborough. Some of the major employers in Richmond Hill include BMW Group Canada and Apotex Inc. Currently, Richmond Hill real estate is a good investment. Current MLS® stats indicate that the average price for a house in the area is $1,483,280 as of May 2024. There were also 573 new listings in the area.
That represents a monthly decrease of 1.7% and a yearly decrease of 2.3% in price. Finally, the most recent numbers report that 192 homes were sold in the last 28 days, with an average of 18 days on the market.
How do Richmond Hill’s demographics come into play? The town’s demographics report that the median age is just over 42. 59% of the people living in the town are families with children. Some of the best neighbourhoods in Richmond Hill include Mill Pond, Northridge, Richvale, and Crosby.
Costs, Fees, and Considerations when Using Private Lenders
Private mortgages typically prove more expensive than traditional bank loans due to the imposition of higher interest rates and additional costs, including those associated with lenders, brokers, attorneys, and appraisers. To illustrate, a loan of $600,000 could be subject to fees of 2–4%, payable either in a single lump sum at the start of the loan or deducted from the principal.
Generally, at the end of the loan, the full amount must be repaid after one year, which is the most common case. Through the entire loan period, only interest is paid. The borrowers should have a plan on how to exit, which can be refinancing or selling the property. The Financial Consumer Agency of Canada (FCAC) recommends carefully analyzing all the terms of the loan, including penalties for early payment and renewal fees. Apex Appraisal – Richmond Hill will provide residents with the assistance they need for property appraisal and guarantee accurate valuations for their properties.
The Richmond Hill Real Estate Landscape
Richmond Hill remains a hot commodity in the GTA. With its rapidly rising land prices putting pressure on buyers and investors. In May 2025, the average selling price of houses reached approximately $1.48 million. This represents a 16% increase over the previous five years. Such a condition has made private lending a practical choice for homeowners who need quick cash through equity and for investors who want bridge financing.
Understanding local property taxes and overall market conditions is important, as these factors influence affordability and a borrower’s ability to manage payments. To get an idea of the current mortgage interest rates in Richmond Hill, borrowers should contact local resources and compare different offers.
How to Locate a Reputable Private Lender in Richmond Hill
Finding a trustworthy private lender requires partnering with a licensed mortgage broker. One that specializes in private lending. According to the MBLAA of Ontario, mortgage brokerages, brokers, agents, and administrators must be licensed, and their credentials can be verified through FSRA’s public registry; private lenders themselves do not require licensing unless they are soliciting or negotiating mortgages on behalf of others.
When comparing different offers, ensure that the rates and conditions are clearly expressed. Avoid partnering with lenders who have unclear fees or are attempting to expedite the deal. Having attorneys specializing in real estate based in the area, such as those in Richmond Hill, guarantees that the agreements are scrutinized and the clients are entirely secured.
Highly-Rated Local Professionals (Richmond Hill)
Real-estate lawyers (refinance/purchase/sale)
- Real Estate Lawyers – full-service Ontario real-estate law firm with flat-rate fees and a Richmond Hill office location
- Shaikh Law – local real estate lawyers offering purchase, sale and refinance legal services with transparent flat legal fees.
- Seif Law firm – real estate legal services in Richmond Hill and the GTA
Appraisers (AIC-designated, Richmond Hill)
Home inspectors (Richmond Hill)
- Carson Dunlop Home Inspection – long-established home inspection company serving Richmond Hill with thorough inspections and ongoing technical support
- Mike Holmes Home Inspection – trained inspectors offering detailed system-level home evaluations and reporting.
- Pillar To Post Home Inspectors – franchise service with local inspectors providing pre-purchase inspections.
Considerations for Richmond Hill Borrowers
In Richmond Hill, private mortgage lending is a way for people who do not meet the requirements of conventional banks to get fast and flexible money. Usually, these loans are more expensive and shorter than a traditional loan, but they can be very fruitful if well planned and a clear exit strategy can be stated. In an area like Richmond Hill that has substantial equity, private lenders provide the means for property owners and investors to get funds quickly, allowing them to take advantage of the market and achieve their property goals.