Access your home equity without breaking your first mortgage.
A second mortgage sits behind your existing first mortgage on title. It lets you borrow against your equity for debt consolidation, renovations, or other needs — without triggering a costly mortgage break penalty.
Is This Right For You?
When a second mortgage makes sense
- You have substantial equity in your home but your first mortgage is locked in with a penalty to break
- You need funds for debt consolidation and want to stop high-interest credit payments
- You're funding home renovations and want to preserve your current mortgage rate
- A bank or credit union has declined your application due to income documentation or credit history
- You need funds quickly — private seconds can close in as little as 3–5 business days
- Your credit has been damaged and you need time to rebuild before refinancing the first mortgage
Typical Terms Overview
Rates shown are indicative ranges for general information only. Your actual rate will depend on property type, location, loan-to-value ratio, borrower profile, and other underwriting factors. Rates are subject to change without notice.
The Process
How a second mortgage works, step by step
From first contact to funded, most second mortgages close within one to two weeks.
Application review
We assess your property value, first mortgage balance, and what you need. The key number is your combined loan-to-value (CLTV) — both mortgages together versus your property value.
Appraisal or property valuation
Most lenders require an independent appraisal to confirm the current market value. In some cases a desktop or drive-by appraisal is acceptable for lower-risk files.
Lender matching and commitment
We identify the most suitable lender and present a written commitment outlining rate, term, fees, and conditions. You review it with your lawyer before proceeding.
Lawyer review and closing
Your real estate lawyer (or one we can refer) handles the document preparation and registration. The mortgage is registered as a second charge on title. Funds advance on closing.
Approval Factors
What lenders look at
Private second mortgage decisions are driven primarily by equity and property quality. Here's how lenders assess your file.
Combined Loan-to-Value (CLTV)
Most private lenders cap second mortgages at 75–80% CLTV in urban Ontario markets. Lower CLTV typically means better rates. Rural properties, condos, and unique property types may attract lower limits.
Property location and type
Lenders prefer urban and suburban Ontario properties with liquid resale markets. Rural, remote, or specialty properties carry more lender risk and may see higher rates or declined applications.
First mortgage status
A first mortgage in good standing (no missed payments) improves your position. Lenders also consider how much time remains on your first mortgage term.
Income and ability to service
Unlike banks, private lenders assess income less formally. They want confidence that you can make the monthly interest payments. Stated income with supporting context is often acceptable.
Credit history
Credit is reviewed but is not the deciding factor. Active collections, recent missed payments on the first mortgage, or an ongoing bankruptcy proceeding will affect the outcome.
Common Questions
Second mortgage FAQ
What is the typical rate for a second mortgage in Ontario?
Private second mortgage rates in Ontario commonly range from 9% to 14% annually, depending on the lender, property, CLTV, and borrower profile. Your broker will present the specific rate in your commitment letter. Rates above this range may appear for higher-risk situations.
How long can a second mortgage term be?
Most private second mortgages are structured as 1-year open or closed terms. This is intentional — private financing is typically a short-term bridge to get you to a better solution (refinancing, selling, improving credit). Longer terms can sometimes be arranged.
Are there fees beyond the interest rate?
Yes. Lender fees (typically 1–3% of the loan amount), broker fees, appraisal costs, and legal fees are standard. All fees must be disclosed in writing before you commit. Ask for a total cost of borrowing estimate upfront.
Will a second mortgage affect my first mortgage?
No, taking a second mortgage does not change your first mortgage. The first mortgage lender is notified because their security position is unchanged, but you remain in the same first mortgage under the same terms.
Can I get a second mortgage with bad credit?
In many cases, yes. Private lenders focus primarily on equity and property value, not credit score. A recent bankruptcy or active consumer proposal may complicate things, but each file is reviewed on its individual merits.
Find out what your equity can do for you.
We'll review your situation, explain your options, and provide a clear cost picture — with no obligation.