When it comes to getting a mortgage, self-employed individuals and those with bad credit may face a few extra hurdles. However, there is still hope in the form of private mortgages.

A private mortgage is a loan that is provided by a private individual or organization, rather than a bank or other traditional lender. These types of mortgages can be a great option for those who don’t qualify for traditional mortgages due to a lack of income documentation or credit issues.

Here are a few things to keep in mind when considering a private mortgage as a self-employed borrower or someone with bad credit:

  • Credit score requirements may be more lenient. Traditional lenders typically have strict credit score requirements, but private lenders may be more willing to overlook credit issues.
  • Down payment requirements may be higher. Private lenders may require a larger down payment, but this can also vary from lender to lender.
  • Interest rates may be higher. Because private mortgages are considered higher-risk loans, interest rates may be higher than those offered by traditional lenders.
  • Due diligence is important. As with any mortgage, it’s important to shop around and compare rates and terms from different private lenders. Make sure to read the fine print and understand all of the terms and conditions before signing on the dotted line.
  • Consider hiring a mortgage broker. A mortgage broker can help you find the right lender and navigate the application process, even if you have bad credit or are self-employed.

One example of how a private mortgage can save a borrower is the story of Sarah. Sarah is a self-employed business owner and had struggled to qualify for a traditional mortgage due to her inconsistent income. She was turned down by several banks, but a friend recommended she look into private mortgages. Sarah found a private lender who was willing to work with her and her unique financial situation. She was able to secure a private mortgage with a slightly higher interest rate, but it allowed her to purchase her dream home.

Another example is the story of John, who had a few late payments on his credit report and was unable to qualify for a traditional mortgage. He reached out to a mortgage broker who helped him find a private lender who was willing to overlook his credit issues and approve him for a mortgage. John was able to purchase a home and start building positive credit history.

Overall, private mortgages can be a viable option for borrowers who don’t qualify for traditional mortgages due to credit or income issues. 

If you’re considering a private mortgage, LenderBidding.com is the best place to go. Our fully digital process that uses AI and our own platform to instantly shop your deals to over 50 of the biggest private lenders in Canada means the lenders bid and compete to give you their best possible pricing. LenderBidding also charges 2-3 TIMES less than the average mortgage broker/agent.


In conclusion, Private mortgages can be a great solution for self-employed borrowers and those with bad credit, who may not be able to qualify for traditional mortgages. 


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