Private Mortgage Lending in Ontario: Where the Market Stands in 2026

Private mortgage lending is a lasting part of Ontario's mortgage market, not only a stopgap for rate shocks. This article collects what the Bank of Canada, CMHC, the Financial Services Regulatory Authority of Ontario (FSRA) and the federal government have published, and says plainly where we do not have a reliable figure. It makes no forecasts of its own.

The Current Backdrop

The Bank of Canada's policy interest rate is 2.25%. The Bank cut it to that level on October 29, 2025, and has held it at each announcement since, most recently on September 2, 2026. The next scheduled announcement is October 28, 2026.1 The Bank's Monetary Policy Report is the place to look for its own projections on growth and inflation; we do not repeat forecasts here.

On housing supply, CMHC reported 259,028 housing starts across Canada in 2025, up 5.6% from 2024 and the fifth-highest annual total on record. Starts in Toronto fell 31%.2

For a thorough overview of how private mortgages work, see our complete guide to private mortgages in Ontario.

The Private Market

FSRA, Ontario's mortgage regulator, publishes an annual report on private residential mortgage lending in Ontario, based on land registry data. We have not been able to read the current report directly, so we do not quote its market-share figures here. Check FSRA's website for the latest edition.3

Who Uses Private Mortgages?

Private lenders typically look closely at the property and the equity in it, which is why borrowers whose situation does not fit a bank's rules sometimes use them. Common situations include:

• Self-employed borrowers whose tax returns do not show their full income. A bank may not be able to use the income the business actually earns.
• Borrowers who need a bridge to conventional financing. For example, someone rebuilding credit or waiting for income documents to show up in their tax filings.
• Borrowers with a tight timeline. A closing date or an arrears problem can leave too little time for a bank's process.
• Separation and buyouts. One partner buying out the other's interest in the home may not qualify alone under bank rules.

None of these is a reason to choose a private mortgage on its own. A licensed broker can compare options and explain the trade-offs for your situation.

What Private Financing Costs

Private mortgages generally cost more than bank mortgages, in both interest and fees, because the lender takes on more risk. We do not publish a private rate table here, because we have not found a published, dated survey that we can cite for private rates. Ask any lender for the rate, every fee and the total cost of borrowing in writing before you sign. For a breakdown of the kinds of charges that can apply, see our article on private mortgage fees in Ontario.

The arithmetic is simple even without a rate quote. Each additional percentage point of interest on a $300,000 mortgage is $3,000 of interest over a year, before fees. This is an illustration, not a quote. OAC. Rates subject to change. Conditions apply.

The Regulatory Environment

Two federal changes took effect on December 15, 2024, and both widen access to conventional financing:4

1. 30-year amortizations became available to all first-time home buyers and to all buyers of new builds. A longer amortization lowers the monthly payment, which may help some borrowers qualify for a conventional mortgage.
2. The price cap for insured mortgages rose from $1 million to $1.5 million.

Rules also change at renewal and on switches between lenders, and they differ by lender and by whether a mortgage is insured. We have not verified the current details from the regulator's own text, so ask your lender what applies to you.

In Ontario, mortgage brokerages that arrange mortgages must be licensed by FSRA, and you can check a brokerage's licence on FSRA's website.3 For help choosing one, see how to choose a mortgage broker in Ontario.

Plan the Exit Before You Start

Most private mortgages have short terms, so the question of what happens at maturity matters from day one. A sound exit plan names how the mortgage will be repaid or replaced (a refinance with a bank or other lender, a sale, or another source of funds), what has to happen first, and what the back-up is if the plan is delayed.

It also helps to be honest about the cost of staying in a private mortgage longer than planned: interest and renewal fees keep building. A broker can help you judge when a move to conventional financing could be realistic. Our article on the exit strategy from a private mortgage to a bank covers the steps.

What We Are Watching

We do not predict where rates, prices or the economy are heading. These are the published sources we check:

• The Bank of Canada's announcements. The next is scheduled for October 28, 2026. Changes in the policy rate can affect what lenders charge and how easily borrowers move to conventional financing.
• FSRA's annual private lending report. It shows how large the private market is and how it is changing.
• CMHC's housing data. Starts and market reports show what is happening in Ontario's housing supply.
• Federal mortgage rules. Changes to qualification rules can shift the line between conventional and private lending.