Survey Exposes Critical Gaps in Canadian Private Mortgage Lending
A recent survey conducted by Perch Capital has uncovered significant disparities between what Canadian mortgage brokers require from private lenders and what they are actually receiving. The findings, collected from mortgage professionals across the country via LinkedIn, indicate that brokers are nearly evenly split on their top priorities, with fast approvals, flexible policies, and competitive pricing all cited as essential factors. This situation paints a troubling picture of an industry where brokers often settle for lenders that excel in one area while falling short in others, leading to widespread dissatisfaction.
Aligning with Broader Market Trends
The survey results are consistent with broader trends identified by organizations such as the Canada Mortgage and Housing Corporation (CMHC) and the Financial Services Regulatory Authority (FSRA). These trends highlight the rapid growth of private lending in Canada, coupled with rising expectations from brokers. However, the gap between broker needs and lender performance is widening, creating challenges in a market undergoing significant transition. As Canada faces a mortgage renewal wave in 2026, with millions of borrowers reassessing their financing options due to new qualifying rates, the demand for private solutions is increasing. Tighter bank underwriting and regulatory changes are further driving borrowers toward alternative mortgage options, placing additional pressure on brokers to find reliable private lending partners.
Institutional Shift in Private Lending
FSRA's 2024 market survey confirms a notable shift in the private lending landscape, with individual private lenders losing market share to institutional operators like mortgage investment corporations. This evolution underscores the need for private lenders to adopt more professional and efficient practices. According to Alex Leduc, CEO of Perch Capital, brokers are no longer seeking lenders of last resort. Instead, they require partners that operate with the speed and professionalism of institutional lenders to meet client expectations and avoid delays or unreliable decision-making.
Perch Capital's Strategic Response
In response to these industry challenges, Perch Capital has secured a $25 million debt facility from a Schedule 1 Canadian bank. This milestone provides the firm with increased deployable capital to support higher origination volumes and faster execution. The facility was secured partly due to Perch Capital's proprietary underwriting technology and auto-adjudication capabilities, enabling the company to offer competitive pricing that smaller, individually-funded private lenders often cannot match. With this additional capital, Perch Capital is actively expanding its broker network across Ontario, British Columbia, and Alberta, targeting reputable mortgage professionals in need of a reliable and responsive private lending partner.
The survey and subsequent developments highlight a critical juncture in Canada's mortgage industry, where the alignment of broker expectations with lender capabilities is becoming increasingly vital for market stability and growth.
