First Mortgage in Edmonton: Private First Mortgages Explained
In Edmonton, a private first mortgage usually fills a gap: a renewal your lender declined, a purchase that has to close before your income is documented, or arrears that need clearing. Because Edmonton homes are more affordable than in many Canadian cities, the loans are smaller — and private lenders look closely at how quickly a home would sell. Here's how it works.
Key takeaways
- A private first mortgage is the main, senior loan on your home.
- Typical 2026 pricing: about 7% to 11% interest-only, with a 1% to 3% lender fee — smaller loans and smaller markets price toward the top.
- Condos and properties outside the city get stricter loan-to-value limits.
- Alberta has no land transfer tax; a mortgage registration levy applies.
What is a private mortgage?
A private mortgage is a loan on property from a non-bank lender — a mortgage investment corporation, a private lending company or an individual investor — approved on equity and the property, without the federal stress test. Alberta mortgage brokers are licensed by RECA.
What is a second mortgage — and how is a first different?
A second mortgage adds money behind an existing first. A private first pays out your current lender or finances a purchase, and takes the senior position. It's cheaper per dollar than a second, but its rate applies to your whole balance. See second mortgages in Edmonton to compare.
Why are private mortgage positions important?
In an Alberta foreclosure, a court-approved sale repays the first mortgage first. Because the Law of Property Act often restricts lenders to the property on mortgages given by individuals, the property's value and saleability are a first lender's main protection — which is why it lends conservatively.
Who lends private first mortgages in Edmonton?
- Alberta and national mortgage investment corporations.
- Private lending companies active in the Edmonton region.
- Individual investors, through RECA-licensed brokerages.
How does the payment work on an Edmonton private first mortgage?
Interest-only, monthly. Example: a $450,000 Edmonton home with a $315,000 private first mortgage (70% loan-to-value) at 9.99%, compounded semi-annually:
| Item | Amount |
|---|---|
| Monthly interest-only payment | $2,569.41 |
| Interest over 12 months | about $30,833 |
| Lender fee (2%) | $6,300 |
| Broker fee, where one applies (1%) | $3,150 |
| Legal and appraisal (estimate) | about $2,100 |
| Mortgage registration levy | about $365 |
| Effective first-year cost | about 14.1% of the net funds |
What's the term of a private first mortgage?
Usually 12 months. Use it to document income, rebuild credit or sell, then refinance to a bank or credit union. Check the prepayment terms so an early exit isn't penalized unnecessarily.
What are the criteria to get approved for a private first mortgage in Edmonton?
- Loan-to-value up to about 70% to 75% on marketable homes; lower for condos and properties outside the city.
- An appraisal, clear title and property taxes current.
- For purchases, a down payment of at least 25% to 30% plus legal and land titles costs.
- Proof of ability to pay the interest.
- A clear exit.
Why are private first mortgage rates higher than traditional mortgages?
Investor capital, no mortgage insurance, borrowers outside bank rules and a short term all add cost. In Alberta, court foreclosure and limits on personal recovery add risk, and smaller loans spread fixed costs over fewer dollars.
What are the pros and cons of a private first mortgage in Edmonton?
| Pros | Cons |
|---|---|
| Lowest-cost private option | Private rate on the whole balance |
| Affordable homes mean smaller loans and payments | Fixed costs weigh more on small loans |
| No land transfer tax | Stricter limits on condos and outlying areas |
| Alberta borrower protections | Short, interest-only term |
Sources
This article is general information, not financial or legal advice. Rate and fee ranges are typical of the private market in 2026 and vary by lender, property and file. Examples are illustrative and rounded, not market averages. Mortgage financing is subject to lender approval.
Frequently asked questions
Yes, but usually at a lower loan-to-value, and lenders review the condo corporation's documents.
$50 plus $5 for every $5,000 of mortgage principal — about $365 on a $315,000 mortgage.
Often, yes. Credit unions set their own lending rules and are a common exit for Alberta private borrowers.
Often within about a week of the appraisal.
Need a private first mortgage in Edmonton?
We'll compare private lenders, MICs and credit unions and show every cost in writing.