When the Bank Says No
A no from your bank is not the end of the road. We work with alternative and private lenders across Alberta, and we always build a plan to get you back to a regular mortgage.
The short answer
Private and alternative lenders approve mortgages for people who don't meet bank rules, such as those with bruised credit, recent self employment, hard to document income or a quick closing. They cost more than a bank mortgage, with higher rates, fees and short terms of one to two years. A good broker checks lower cost options first, discloses every fee up front, and sets out a clear plan to move you back to a bank.
Lacroix Mortgage Group is a Calgary mortgage team licensed with and powered by Mortgage Connection Inc., a mortgage brokerage licensed in Alberta by the Real Estate Council of Alberta (RECA), and part of the DLCG network. Our brokers are individually licensed. See licence details.
The Three Types of Lenders
Banks (A Lenders)
Best rates. Strict rules on credit, income and debt ratios.
Alternative (B Lenders)
Trust companies and some credit unions. More flexible on credit and income, with slightly higher rates and a lender fee.
Private Lenders
Individuals or mortgage investment corporations. Focus on the property and your equity. Short terms, higher cost, fast decisions.
Private and Alternative Mortgage Questions
Who uses private or alternative mortgages?
People who don't fit the bank box right now. Common reasons are bruised or rebuilding credit, recent self employment, income that is hard to document, a consumer proposal or past bankruptcy, high debt ratios, a quick closing, or a property the banks won't finance. It is usually a short term bridge, not a forever mortgage.
What does a private mortgage cost?
Private and alternative mortgages cost more than a bank mortgage. Expect a higher interest rate and lender and broker fees, and terms are usually one or two years. We show you every cost in writing up front, along with the total cost over the term, so you can decide with real numbers.
What is the plan to get back to a bank?
Every private or alternative mortgage we arrange starts with an exit plan. That might mean rebuilding credit, showing two years of self employed income, paying down debts, or waiting out a past credit event. We map out the steps and timing so you can move back to a regular lender as soon as you qualify.
Should I go straight to a private lender?
Not usually. A lot of people who think they need a private lender actually qualify with a B lender or a credit union, at a lower cost. We start with the lowest cost option that will approve you and only use private money when it is the right tool.
How fast can a private mortgage close?
Private lenders can often approve and fund much faster than banks, which helps with tight closing dates, bridge situations or stopping a foreclosure. Timing still depends on the appraisal and the lawyers.
How We Handle It
- 1
Honest Review
Your credit, income, equity and what happened.
- 2
Lowest Cost Option
We check banks, B lenders and credit unions first.
- 3
Full Cost Disclosure
Rate, fees and total cost in writing before you commit.
- 4
Exit Plan
Clear steps and timing to move back to a bank.
No Judgment, Just Options
Tell us what is going on and a broker will tell you honestly what is possible and what it will cost. Everything you share stays confidential.
All mortgages are subject to lender approval. Private and alternative mortgages carry higher costs than bank mortgages, and all fees are disclosed in writing before you commit.
Talk to a Broker
Share a little about your situation and timeline.
Questions About Working With a Mortgage Broker
How does a mortgage broker get paid in Alberta?
Mortgage brokers in Alberta are usually paid by the lender when your mortgage closes, not by you. The lender pays the brokerage a finder's fee, so for most standard residential mortgages our service costs you nothing.
How much do I need for a down payment in Calgary?
In Canada the minimum down payment depends on the purchase price. Up to $500,000 you need 5%. Between $500,000 and $1,500,000 you need 5% on the first $500,000 and 10% on the rest. At $1,500,000 or more you need 20%. Many Calgary first time buyers put down 5% to 10%.
How does the mortgage stress test work in Canada?
You must qualify at the higher of your contract rate plus 2% or the 5.25% minimum qualifying rate. The rule is set by OSFI (the Office of the Superintendent of Financial Institutions), not the Bank of Canada, and applies to federally regulated lenders. It checks that you could still afford payments if rates rise.
Is it better to go with a bank or a mortgage broker?
A bank can only offer its own products. A broker compares dozens of lenders, including major banks, credit unions and alternative lenders, and matches you to the best fit. Brokers often find better rates, more flexible terms, or approvals a single bank would not offer, at no cost to you for most mortgages.
When should I start shopping for my mortgage renewal in Alberta?
Start about 120 days before your term ends. Most lenders will hold a rate for up to 120 days, which gives you time to compare offers without rushing. A broker can review your renewal letter and show you what else is available.
Can you help if I'm self employed or my income has changed?
Yes. Self employed borrowers and people with commission, contract or changing income often benefit most from a broker. We work with lenders that specialize in business for self and non traditional income, and matching you to the right lender matters more when documents are not straightforward.
When should I talk to a mortgage broker?
Before you start house hunting. A pre-approval gives you a clear budget, can hold a rate for 90 to 120 days, and shows sellers you are serious. If you are renewing or refinancing, reach out at least four months before your term ends.