Understanding Your Mortgage Options to Make Informed Decisions in Canada

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TORONTO, March 6, 2025 — With the current wave of mortgage renewals in Ontario, many families are finding themselves facing significantly higher mortgage rates than when they first secured their loans. For some consumers, qualifying for a traditional mortgage from a bank or credit union may no longer be an option, and they may be considering private mortgages as an alternative. To help guide Ontarians through these decisions, the Financial Services Regulatory Authority of Ontario (FSRA) is launching its annual multilingual consumer education campaign, offering valuable insights into the benefits and potential challenges of private mortgages.

Educating Consumers on Private Mortgages

FSRA’s Head of Financial Institutions and Mortgage Brokerage Conduct, Antoinette Leung, emphasizes the importance of understanding private mortgage products. “Although interest rates are coming down, there is a wave of mortgage renewals this year and families are facing increases that are much higher than when they first secured their mortgage years ago,” Leung explains. “If you are thinking about getting a private mortgage, I encourage everyone to ask a lot of questions, know what you are getting into, and have an exit strategy.”

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Private mortgages can be an essential tool for individuals who may not qualify for traditional mortgage products, but they come with their own set of complexities and risks. FSRA’s educational initiative is designed to empower consumers—particularly those from diverse communities—by providing them with the knowledge to make informed decisions about private mortgages.

What You Need to Know About Private Mortgages

FSRA aims to educate consumers on the nuances of private mortgages to ensure they fully understand the options available to them. Here are some key takeaways from FSRA’s campaign:

  1. Temporary Solutions
    Private mortgages are typically short-term solutions, designed to last between one to two years. These loans are often used by individuals whose financial circumstances have temporarily made them ineligible for traditional mortgage options. The goal is to give consumers time to improve their financial situation and qualify for a more conventional mortgage in the future.

  2. The Importance of an Exit Strategy
    An essential component of any private mortgage arrangement is having a clear plan to transition back to traditional mortgage lenders. FSRA stresses the importance of consumers planning ahead and working towards financial stability so that they can eventually move away from private lenders and secure a mortgage from a bank or credit union.

  3. Engaging FSRA-Licensed Mortgage Professionals
    If a private mortgage seems like the right option, FSRA advises consumers to engage with licensed mortgage professionals who can provide expert guidance on the terms and conditions associated with these loans. FSRA-licensed professionals can ensure that consumers are fully informed about their mortgage and help them navigate the complexities of private lending.

FSRA’s Commitment to Consumer Education

FSRA’s multilingual awareness campaign is designed to ensure that all Ontarians, regardless of their background, have the resources they need to make smart financial decisions. By providing clear and accessible information about private mortgages, FSRA is working to empower consumers and help them avoid financial pitfalls.

Learn More

To learn more about private mortgages and how to make informed decisions, FSRA encourages consumers to explore the following resources:

FSRA continues to be committed to financial safety, fairness, and choice for everyone, ensuring that all Ontarians are equipped to make decisions that promote long-term financial stability. With the right information and guidance, consumers can navigate the challenges of private mortgages and secure a solid financial future.

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