Private Mortgages in BC: The Complete 2026 Guide
If a BC bank has declined your mortgage, you need to close fast, or your situation doesn't fit conventional lending criteria, a private mortgage is often the only realistic path. This guide explains exactly how they work in BC, what the all-in costs really are, and how to evaluate competing offers before you sign anything.
What is a private mortgage in BC?
A private mortgage is a real estate loan funded by a non-bank lender — typically a Mortgage Investment Corporation (MIC), syndicated investor pool, or wealthy individual. Approval is based on the property's value and your equity position, not your beacon score, T4 income, or debt-service ratios.
Private mortgages exist because banks and B-lenders can't fund every situation. Banks need to pass the B-20 stress test, require proven income via T4 or 2-year self-employed average, and won't touch many property types (rural, leasehold, former grow-op, mobile on a leased pad). Privates fill the gap — at a higher cost.
How private mortgages are structured in BC
Almost every BC private mortgage follows the same template:
- 1-year term, interest-only. You pay interest each month; the principal is paid in full at term end via refinance or sale.
- Equity-based approval. The lender's underwriter cares about LTV (loan-to-value), property quality, and your exit plan. Beacon and income are secondary.
- Open after 3–6 months. Most BC privates let you pay out without penalty after a minimum closed period (usually 3 or 6 months).
- Fees deducted from proceeds. Lender fee, broker fee, and legal/appraisal come out of the loan amount, not your pocket.
- Registered as a real estate charge. The lender registers a mortgage charge on your title at Land Title Office.
Current BC private mortgage rate ranges (mid-2026)
| Position | Rate range | Lender fee | Typical max LTV |
|---|---|---|---|
| 1st position | ~8.99–12.99% | ~1–2% | 75% (metro), 65% (rural) |
| 2nd position | ~10.99–14.99% | ~1.5–3% | 75–80% combined LTV |
| 3rd position (rare) | ~13–17%+ | ~2–4% | Case-by-case |
General market ranges, OAC. Subject to change. Add 1% broker fee and $1,500–$3,500 legal/appraisal to get your all-in cost.
A 9.49% offer with 3% lender fee can cost more in year one than a 10.99% offer with 1% fee. Always calculate total cost over the full term including fees. Use the calculator to model your specific situation.
MIC vs individual private lenders
Mortgage Investment Corporations (MICs)
MICs pool investor capital and lend it across many mortgages. They have formal underwriting processes, defined criteria, and consistent pricing. They're usually the cheapest tier in private and the most predictable. Major BC-active MICs: Fisgard, CMI, Antrim, Vault, Romspen, VWR Capital. Most won't take direct submissions — files come through licensed mortgage professionals.
Individual private lenders
Wealthy individuals (or family offices) funding mortgages personally. Decisions are made by one person rather than an underwriting committee — so files move faster, but pricing is less predictable. Individuals are often more flexible on unusual file types (rural, mixed-use, complex story) but rates can run higher. Accessed through brokers.
Match your file to the right lender tier
2-minute qualifier matches your specific situation to the MIC, individual private, or B-lender most likely to fund it. No credit pull.
Check My OptionsWhat underwriters actually care about
- LTV (loan-to-value). The single biggest variable. At 50–60% LTV, you have many lenders bidding. At 70–75%, the pool shrinks and the rate creeps up. At 80%+, only a handful of lenders look at it and rates push to the top of the range.
- Property type and location. Metro Vancouver detached is universal. Rural mobile on a leased pad gets one or two lenders, if any. The lender list is built around the property before anything else.
- Exit plan. Underwriters want to see exactly how you refinance them out in 12 months. Common exits: refinance to a B-lender once credit recovers; refinance to an A-lender once income stabilizes; sell the property; payoff from a business sale.
- Borrower story. Privates accept "messy" — divorce, bankruptcy discharge, business windup — as long as the story is coherent and the exit is real. A blank "no story" file is harder to fund than a complicated one with a clear narrative.
- Beacon score (last). A 500 beacon won't disqualify you if LTV and exit are strong. A 750 beacon won't help you if LTV is at 78% and there's no exit.
How to evaluate competing private mortgage offers
If you have multiple offers, compare these five things in writing:
- Total all-in cost over 12 months. Rate × balance + lender fee + broker fee + legal. The cheapest headline rate is often not the cheapest all-in.
- Renewal terms. Some lenders charge 1–2% to renew if you don't pay out at maturity. Others let you renew at the same rate. This matters a lot if your exit slips.
- Prepayment penalty. Most BC privates are open after 3–6 months. Some hold you to the full year of interest. Read the commitment letter.
- Appraisal scope. Bridge / private lenders sometimes use their own appraisers who come in 10–15% below market on rushed orders. Insist on knowing the appraiser before they pull the file.
- Who's actually deciding. MIC with an underwriting committee → predictable but slower. Single private lender → faster but rate can move if their cash position changes.
When private mortgages don't make sense
Private isn't always the answer. Skip private and look elsewhere if:
- You can wait 3–6 months and rebuild credit / income — a B-lender or A-lender deal in 6 months will save 300–600 basis points
- The underlying problem is income, not credit or property — taking on higher-cost debt without fixing income just delays the same issue
- The loan amount is small (under $50,000) and unsecured personal lending is cheaper all-in
- The property is being foreclosed and a private won't stop the foreclosure — sometimes selling on your own timeline preserves more equity
The exit plan is the most important part of the application
Most BC borrowers focus on rate. Underwriters focus on exit. A private lender's worst-case is renewing you indefinitely at climbing rates because you can't refinance to a bank. They protect against that by demanding a credible exit.
A good exit plan answers: which bank or B-lender will take this file in 12 months, what specifically has to change between now and then to qualify (credit rebuild, income established, equity from sale of another asset, business sale), and what's the fallback if Plan A doesn't materialize. Have this written down before you submit.
Ready to see real BC private mortgage offers?
A licensed BC mortgage professional will pull 2–4 competing offers tailored to your specific file. 2-minute qualifier, no credit pull, no obligation.
Check My OptionsFrequently asked questions
As of mid-2026, BC private 1st mortgages run roughly 8.99–12.99% and 2nd mortgages 10.99–14.99%, plus 1–3% in lender + broker fees deducted from proceeds. Rates are general market ranges, subject to change, OAC.
A clean private file in BC closes in 5–10 business days from application to funding, assuming a clean appraisal and complete file. This is one of the main reasons people choose private over bank financing — banks need 3–6 weeks minimum.
Most BC MICs cap 1st-position private mortgages at 75% LTV in metro Vancouver, lower in smaller towns and rural areas. On 2nds, combined LTV (1st + 2nd) is usually capped at 75–80% in metro markets.
No. Private mortgages are equity-based, not credit-based. Lenders look primarily at the property's value, your equity position, and your exit plan. Beacon scores under 500 are routinely funded if the LTV and exit are strong.
Yes, though the lender pool is smaller and rates run at the top of the range. Many MICs have rural carve-outs at lower LTV (often 60–65% in non-metro). Individual private lenders are usually more flexible on rural than MICs.