MIC or individual lender: same private market, different structure.

A Mortgage Investment Corporation is a pooled investment vehicle, structured under Section 130.1 of the federal Income Tax Act, where investors buy shares and the MIC lends that pooled capital across a diversified portfolio of mortgages — a MIC must hold at least 20 shareholders, with no single shareholder owning more than 25%, and at least half its assets in residential mortgages or insured cash. An individual private lender funds a deal with their own capital, concentrated in that one mortgage rather than spread across a portfolio.

That difference in structure is also a difference in risk exposure for the lender's side of the deal: a default on a MIC-funded mortgage is absorbed across the fund's whole portfolio, while a default on an individually funded mortgage is a much more concentrated loss for that one person.

The tax treatment on the investor side reflects the same structural difference. A MIC deducts the dividends it pays to shareholders, so income effectively flows through and is taxed once, at the shareholder level, as interest income — and MIC shares are eligible investments for RRSPs, TFSAs, and RRIFs. An individual private lender is simply earning interest income directly on their own loan, taxed as ordinary income with none of the pooling or registered-account eligibility a MIC structure offers. On the borrower side, either type of private financing is often the bridge to a file that eventually qualifies through alt-doc or traditional qualification once income documentation or credit history catches up.

A MIC is professionally managed, typically with dedicated underwriting, servicing, and compliance functions handling the portfolio. An individual private lender's process is only as consistent as that person's own experience — documentation standards, turnaround time, and how a late payment gets handled can vary widely from one private lender to the next.

That consistency has a practical downstream effect on a broker's workflow: a MIC's underwriting requirements, once learned, tend to stay the same file over file, which lets a broker package submissions predictably. An individual lender might want more (or less) documentation than the last deal, or handle a payment issue on a case-by-case basis rather than by a written policy, which means a broker builds a relationship with that specific person's habits rather than a repeatable process.

Regulatory oversight differs too. In Ontario, an individual lending their own money as a mortgage lender must be licensed under the Mortgage Brokerages, Lenders and Administrators Act unless the deal runs through a licensed brokerage — a compliance detail worth confirming before a broker arranges a client-to-individual private deal directly.

Both sit outside A/B underwriting timelines and standard guideline boxes, which is the whole reason a broker reaches for either. MICs, despite being professionally managed, can often approve and fund in as little as two weeks because their guidelines are set by the fund's own risk mandate rather than a bank's policy manual. An individual lender can, in principle, move even faster on a straightforward deal — there's no committee, just that person's own decision — but the trade-off is that speed depends entirely on their availability and comfort with the file that week.

Private lending rates and fees vary by lender, loan-to-value, and file quality — there is no single published rate card the way there is for insured mortgage premiums. Set the expectation with the client as a range to be confirmed once a specific lender is identified, not a fixed number quoted up front, and factor in lender fees and any broker fee on top of the rate itself.

For files that need this kind of structuring, Treadstone's broker support covers the extra documentation and packaging private lenders and MICs typically require beyond a standard A-lender submission. Setting expectations with the client on exit strategy matters just as much as the initial cost — private financing is almost always meant to be short-term, bridging to a refinance with an A or B lender once the underlying issue (credit repair, income documentation, a property in transition) resolves, and a client who treats it as permanent financing can end up paying private rates far longer than the file ever needed to.