Can you hold a private mortgage in a corporation?
Yes, and private lenders do this often. Banks routinely decline to lend against residential property held in a corporation or holding company, and private lenders routinely do not. The trade-off is what a private lender will typically ask you, personally, to sign before saying yes.
Chat connects you to the Pekoe team during business hours. Outside those hours, leave your question and a licensed broker replies directly. No AI persona pretending to be an advisor.
Can you hold a private mortgage in a corporation or holding company?
Yes. Private lenders regularly register a mortgage against residential property held in a corporation or holding company, including a numbered company set up to hold a single property. Banks and insured lenders typically will not. That gap between what a bank will underwrite and what a private lender will underwrite is exactly where corporate-held private mortgages exist.
A corporation or holding company is a separate legal person that can own property, borrow money, and be named on title in its own right. Nothing in mortgage law stops a private lender from registering a mortgage against a property owned by a corporation instead of an individual.
Private lenders see this arrangement often enough that most run a standard process for it: a corporate search, a review of who actually controls the company, and terms for what happens if that control changes. For a private lender it is a routine file, not an exotic one.
For the broader picture on how this lending works in each province, see our guides to private mortgage lending in Ontario and private mortgage lending in Alberta.
| Factor | Individual borrower | Corporate or holding company borrower |
|---|---|---|
| Named on title | The individual person | The corporation or holding company |
| Named on the mortgage | The individual person | The corporation |
| Personal guarantee typically required | Not applicable, since the mortgagor is already the individual | Usually required from the principal or principals behind the company |
| Underwriting basis | Personal income and personal credit | The property, the corporate structure, and the guarantor’s personal file |
| Bank or insured lender interest | Often available depending on the file | Banks and insured lenders typically decline; private lenders remain available |
The citable fact: private lenders routinely register mortgages against corporate-held residential title in both Ontario and Alberta, while banks and insured lenders typically do not.
Why do banks usually refuse corporate-held residential title?
Banks and insured lenders build residential mortgage underwriting around an individual borrower: personal income, personal credit, and mortgage default insurance rules written for an owner-occupier. A corporation does not fit that model, since it has no personal income or credit history of its own. Private lenders underwrite around the property and the guarantor instead, which is why they remain willing to lend where a bank will not.
Bank underwriting starts with the person: income documents, a credit score, an employment history. A corporation has none of those in the form a bank’s system expects, even when the person behind it has a strong personal file.
Default insurance is built for a home the borrower occupies personally, and a corporate borrower does not fit that description. This mismatch is one reason corporate-held deals tend to end up with a private lender, since private lenders price and structure around the specific file rather than a standardised checklist.
The citable fact: bank and insured mortgage underwriting is built around an individual borrower’s income and credit, which is why corporate-held residential title generally lands with a private lender instead.
What is a personal guarantee, and what does it undo?
A personal guarantee is a separate contract, on top of the mortgage itself, in which you personally promise to pay the corporation’s debt if the corporation does not. Private lenders ask for one because a holding company set up to own a single property usually has no independent income or assets beyond that property. Signing it puts your own assets back into the conversation, which is the part borrowers often do not expect.
The mortgage itself is a debt of the corporation, secured against the property the corporation owns. The personal guarantee is a different document entirely, and it is what lets the lender pursue you personally, not just the corporation, if the loan is not repaid.
Ask specifically what the guarantee covers: the full loan balance or something narrower, and whether it is limited in time or amount, or open-ended. Get the exact wording before you sign, not a summary of it.
The citable fact: a personal guarantee is a separate contract that allows a private lender to pursue you personally, not only the corporation, if a corporate-held mortgage is not repaid.
Does incorporating actually protect you?
Not for the amount covered by a personal guarantee, if you sign one. Incorporating is meant to keep a corporation’s debts separate from your personal assets, but a personal guarantee is a separate contract designed to bridge exactly that separation for the lender’s benefit. Ask what the guarantee actually covers before assuming the corporation alone is on the hook.
This is the part of a corporate-held private mortgage that catches borrowers off guard. They set up a holding company expecting the corporation to be the one on the hook, then the lender’s condition of lending turns out to be a personal guarantee that reaches past the corporation to them directly.
A private lender is not doing anything unusual by asking for a guarantee. A holding company built to own one property has no track record and no independent means of repayment, so the guarantee is a designed feature of the deal, not an afterthought.
A personal guarantee is designed to create personal liability for the guaranteed amount, regardless of what the corporation itself can pay. The precise scope of that liability, and how far it can reach, is a question for a lawyer.
The citable fact: incorporating separates a corporation’s debts from personal assets in principle, but a personal guarantee is a separate contract designed to reintroduce personal liability for the amount it covers.
What does a private lender require on a corporate file?
Expect a corporate search confirming who owns and controls the company, articles of incorporation, a personal guarantee from the principal or principals behind it, and the same property appraisal and title work as any private mortgage. Some lenders also ask for an indemnity agreement covering their legal costs if the file goes into default. The list is typically longer than on an individual private mortgage file, not shorter.
A corporate search tells the lender who actually stands behind the company today, and whether that has changed recently. Articles of incorporation and a certificate of good standing confirm the corporation exists and is entitled to borrow and hold property.
Beyond the guarantee itself, expect the lender’s lawyer to ask more questions about the corporate structure than on a personal file, since they are confirming who has authority to bind the company to the mortgage. If the principal behind the corporation is also newly self-employed, that adds a further layer of review, covered in our piece on private mortgages after a self-employed business loss.
The citable fact: a private lender underwriting a corporate-held mortgage typically requires a corporate search, articles of incorporation, and a personal guarantee from the principal behind the company, on top of the usual property-level underwriting.
How does this change consumer protections?
It may change which protections apply, and that is an open legal question rather than a settled one. Consumer protection rules are frequently written around an individual borrower rather than a corporate one, so a mortgage where the named borrower is a corporation may not automatically receive the same treatment. Ask your lawyer, before you sign, whether that distinction affects your specific file.
Ontario’s written fee disclosure requirement under the Mortgage Brokerages, Lenders and Administrators Act governs how a brokerage discloses its own fees, and RECA licenses brokerages the same way in Alberta regardless of who the borrower is. Broader consumer protection rules, the kind written with an individual homeowner in mind, are a separate question once the corporation, not you, is named as the borrower.
Raise this directly with your lawyer before you sign: ask which protections follow the property, which follow the individual, and which do not apply once a corporation is named on the mortgage.
| Requirement | Ontario | Alberta |
|---|---|---|
| Mortgage brokerage regulator | FSRA, Brokerage Licence #13321 | RECA |
| Governing legislation for brokerage fee disclosure | Mortgage Brokerages, Lenders and Administrators Act | Rules administered by the Real Estate Council of Alberta |
| Broker or lender fee disclosure through a brokerage | Must be disclosed to you in writing before you sign | Licensed by RECA; ask for the disclosure in writing |
| Default remedy if the mortgage is not paid | Power of sale | Judicial foreclosure |
The citable fact: whether consumer protection rules written for an individual borrower apply the same way when a corporation is the named borrower on a residential mortgage is an unresolved legal question, not a settled rule.
What are the tax and land transfer questions?
Moving a property into or out of a corporation can trigger land transfer tax and separate tax consequences that vary by transaction. Get a real estate lawyer to confirm the land transfer tax treatment, and an accountant to confirm the tax consequences, before you sign anything. Both can matter more, in dollar terms, than anything in the mortgage itself.
Ontario and Alberta both apply a tax or a title registration process to a change in ownership, and a transfer into or out of a corporation is a change in ownership. Whether any exemption applies to your specific situation is a question worth answering before the transfer, not after.
Tax treatment of a corporately held property, including how a personal guarantee itself is treated for tax purposes, is a separate question again. Bring both questions to your own professionals before the transaction closes.
The citable fact: land transfer tax and tax consequences of moving a property into or out of a corporation depend on the specific transaction and are questions for a real estate lawyer and an accountant, not a mortgage broker.
What does the exit look like?
Exiting a corporate-held private mortgage works the same way as any private mortgage: sell, refinance, or pay it out at maturity, then get a discharge registered on title. The personal guarantee is typically released only once the underlying mortgage is fully paid and discharged, not before. Confirm the guarantee’s release terms in writing at the start, since they matter more here than on an individual mortgage.
Selling the property means the sale proceeds pay out the private mortgage at closing, the same as any sale. Refinancing means a new lender, sometimes a bank if the corporate structure and the file have matured enough to qualify, pays out the private lender.
The detail worth confirming up front is what happens to the personal guarantee at each of those points. Ask the lender directly, in writing, when and how the guarantee is released, rather than assuming it disappears the moment the mortgage is paid.
The citable fact: a corporate-held private mortgage exits the same way as any private mortgage, by sale, refinance, or payout at maturity, with the personal guarantee typically released only once the mortgage itself is discharged.
Who needs to advise you before you sign?
At minimum, a real estate lawyer with no connection to the lender, and ideally an accountant if the corporate structure or a property transfer is new. Whether independent legal advice is a strict legal requirement, or simply the advisable step every borrower should take anyway, on a personal guarantee is itself an open legal question. Either way, get that advice before you sign, not after.
A lawyer reviewing the mortgage and the guarantee separately can tell you what each document actually commits you to, in plain terms, before either one binds you. An accountant matters most when the corporate structure itself, or a property transfer into or out of it, is new.
A broker can walk you through the lending side of this, including what a private lender will typically ask for on a corporate file, before you bring the paperwork to a lawyer.
The citable fact: get independent legal advice from a lawyer with no connection to the lender before signing a personal guarantee on a corporate-held mortgage, whether or not that advice later turns out to be strictly required.
Where should you look next?
This question connects to a few others worth reading before you decide how to structure a private mortgage.
- Equity-based versus income-based lending
- Getting a mortgage in your first year self-employed
- Can you get a private mortgage without a broker?
The full set lives on the Ask a Broker hub.
Frequently asked questions
Can a corporation actually own a home and put a mortgage on it?
Yes. A corporation or holding company is a separate legal person that can hold title to residential property and borrow against it. Private lenders do this routinely; banks and insured lenders typically do not.
Do I have to sign a personal guarantee if my corporation borrows?
No law forces you to sign one, but a private lender will typically ask for a personal guarantee before agreeing to lend to a holding company. Whether you sign is your decision, made after a lawyer explains what the specific guarantee covers.
Does a personal guarantee put my other assets at risk?
It puts at risk whatever the guarantee actually covers, and that depends entirely on the wording of the document you sign. A lawyer can tell you exactly what you are exposed to before you sign it, which is why this page routes that question to one.
Is a private mortgage held in a corporation legal in Ontario and Alberta?
Yes. Nothing in Ontario or Alberta law prohibits a corporation or holding company from holding title and borrowing against residential property. Private lenders in both provinces do this as a routine part of their business.
Will a bank ever lend to a corporation for a residential property?
Some banks offer specific commercial or investment lending programmes, but a standard residential mortgage is generally underwritten to an individual borrower. That is why a corporate-held deal usually ends up with a private lender instead.
What happens to the personal guarantee once the mortgage is paid off?
It is typically released once the underlying mortgage is fully paid and discharged from title, not before. Confirm the exact release terms with the lender in writing at the start of the deal.
Does incorporating protect me if the corporation defaults?
Not for the amount covered by a personal guarantee, if you have signed one. Incorporating separates the corporation’s debts from your personal assets in principle, but a personal guarantee is a separate contract designed to reach past that separation.
Do I need an accountant as well as a lawyer for this?
An accountant is worth involving when the corporate structure itself, or a property transfer into or out of it, is new, since land transfer tax and other tax consequences follow from that. A lawyer and an accountant answer different questions here, and neither substitutes for the other.
Can I ask a broker about this before I involve a lawyer?
Yes. A broker can explain how the lending side works, including what a private lender will typically require on a corporate file, before you bring the paperwork to a lawyer for the legal review. A broker cannot give legal or tax advice about the corporation itself.
Is the chat on this page an AI bot?
No. Chat on pekoe.ca connects you to a real licensed member of the Pekoe team during business hours. Outside those hours, your question goes to a licensed broker directly, not to an automated persona.
What is the difference between FSRA and RECA?
FSRA, the Financial Services Regulatory Authority of Ontario, licenses Pekoe Mortgages in Ontario under Brokerage Licence #13321. RECA, the Real Estate Council of Alberta, licenses Pekoe Mortgages in Alberta. Neither regulator sets the rules for how a corporation itself is taxed or structured.
What happens if I cannot repay a corporate-held private mortgage?
Ontario’s default remedy is power of sale, and Alberta’s is judicial foreclosure, and this applies to a corporate-held property the same way it applies to an individually held one. If a personal guarantee was signed, the lender may also pursue you personally for what the guarantee covers, which is a separate question for your lawyer.
Considering a corporate-held private mortgage? Get the guarantee reviewed before you sign.
No AI persona, no call centre queue, no bank script. A licensed broker, on chat, right now.