Private Lending 101: A Smart Complement to Conventional Mortgages
Continuous learning is key in our industry—and this week’s private-lender education session with Castleton Hypothèques underscored that truth.
We explored how short-term private financing can work alongside traditional mortgage paths—especially when clients need flexibility or faster access to funds. With quick approvals, flexible term lengths, and lighter documentation, private lending can be an important tool in a broker’s toolkit when used thoughtfully and with clear exit strategies.
Why Private Lending Matters Right Now
With many mortgages set to renew over the next 9–12 months, it’s the perfect time to review all options—whether:
Conventional renewal with strategy around term selection, penalties, and prepayment privileges, or
Alternative/private financing to navigate short-term needs and set up a path back to a prime product.
Renewals may come with payment adjustments depending on the rate environment and the product you choose. Strategic planning helps clients avoid surprises and align decisions with their cash flow and goals.
Where Private Lending Can Help
Private solutions can provide bridge support for clients who are:
Consolidating debt to improve cash flow before moving back to a prime mortgage
Accessing capital quickly for renovations, investments, or time-sensitive opportunities
Bridging between a purchase and sale (or while waiting for conventional funding)
Self-employed or non-traditional income profiles that don’t fit standard underwriting—yet
It’s about matching the right product to the right situation, working in concert with banks, private lenders, and broker partners to deliver the best outcome.
What to Expect with a Private Mortgage
Speed: Typically faster decisions and funding timelines
Flexibility: Shorter terms and creative structures (open/closed, interest-only in some cases)
Documentation: Often fewer docs than conventional—still prudent underwriting
Costs: Rates and fees are usually higher than prime; the value is in speed and flexibility
Exit Strategy: A clear plan to transition to a conventional product when eligible
How We Guide Clients
Clarify the objective (cash flow relief, bridge, renovation, credit rebuild, etc.)
Assess total cost of ownership (not just the rate) including fees, penalties, and timeline
Design the exit—set measurable milestones and a realistic timeline to move back to prime
Communicate clearly so clients understand trade-offs and feel confident in each step
Let’s Talk Through Your Options
If you’re renewing in the next year—or you’re navigating a unique scenario—let’s map out a plan that fits.
Call/Text: 514-994-1030
I’m happy to review your situation and outline conventional and private paths side-by-side so you can choose with confidence.
This post is for general information only and isn’t financial advice. Qualification, terms, and product availability are subject to lender guidelines and change.