Private & Alternative Lending in Calgary
Private mortgages in Calgary
A private mortgage is a loan from an individual or a mortgage investment corporation rather than a bank. The decision is driven mainly by the equity and quality of the property, not by your credit score or your debt-service ratios. That is precisely why it can solve problems a bank cannot.
It is also more expensive, usually shorter-term, and carries lender and broker fees. Anyone who presents it as equivalent to a bank mortgage is selling you something.
The rule that matters
A private mortgage should be a bridge with a defined exit — never a destination.
Before you sign one, you should be able to answer: what specifically will have changed in 6 to 12 months that lets a cheaper lender take over? If nobody can answer that clearly, the loan is not a plan, it is a delay — and delays on expensive money get costly fast.
When it genuinely is the right tool
- Stopping a foreclosure or clearing arrears before they become a court process.
- Paying out judgments, writs or liens registered on title that block any normal refinance.
- Bridging a timing gap — a purchase that has to close before a sale completes, or a deal that has to fund faster than an A lender can move.
- Income that is real but not yet provable — recently self-employed, a new business, income that will not show properly on paper for another tax year.
- A property or situation a bank will not touch temporarily, where the fix is known and time-bound.
What it costs, honestly
Expect a higher interest rate than a bank, plus lender and broker fees, and often a one-year term. Interest is frequently interest-only, and it can sometimes be prepaid and built into the loan so there is no monthly payment during the bridge — which is the difference between a rescue that works and one that adds a payment you already could not make.
The right way to judge the cost is not against a bank rate. It is against the alternative: what a forced sale, a completed foreclosure, or another year of 22% credit card interest would actually take from you.
B lenders sit in between
Not every file that fails at a bank needs private money. B lenders — trust companies and alternative institutional lenders — sit between banks and private lending, with more flexible qualification at a modest premium. Often that is the right landing spot, either directly or as the step between a private bridge and a return to A lending.
Working out which of the three tiers you actually belong in is most of the value here. See a real Calgary file that used a private second as a bridge and finished back at a mainstream lender on one consolidated payment.