A private or alternative-lending file fails less often because the borrower doesn't qualify and more often because a piece of the file wasn't ready when the lender needed it — a missing payout statement, a disclosure sent one day too late, an exit strategy nobody wrote down.
This checklist works through the file in the order the pieces are usually needed: confirming lender fit, building the valuation and equity package, assembling the required disclosure, lining up legal and registration, and documenting the exit before the file is considered complete.
Step 1. Confirm the lender type and its specific requirements
A mortgage investment corporation, an individual private lender, and a B lender don't ask for the same package. Confirm which type of lender the file is going to before assembling anything else — see what is a B lender in Canada and what is a MIC in Canada for how the two differ in underwriting basis.
- →Confirm whether the lender needs a formal underwriting package or primarily an equity-based summary.
- →Confirm the lender's specific documentation preferences before requesting anything from the client twice.
Step 2. Assemble the property and valuation package
Private and B-lender decisions weigh equity heavily, so the valuation package carries more weight here than on a conventional file. Gather:
- →A current appraisal or other acceptable evidence of property value, ordered before conditions are set, not after.
- →A title search confirming what else is already registered against the property.
- →For a second mortgage specifically, a current payout statement on the existing first mortgage — see the broker's guide to second mortgages for why this figure has to be current, not assumed.
Step 3. Document identity, equity, and the purpose-of-funds narrative
Reasonable steps to verify a party's identity are a standing obligation on a mortgage brokerage, not an optional step for private files specifically. Alongside identity, write a short, factual purpose-of-funds narrative — what the money is for, and how it fits the client's broader financial picture — since a private lender's decision leans more heavily on this story than a bank's formula-driven approval does.
Step 4. Build the cost-of-borrowing and fee disclosure package
In Ontario, the cost of borrowing — including any brokerage fee — must be disclosed to the borrower in writing, and it must reach them no later than two business days before the earlier of the relevant transaction events, unless a signed waiver shortens that to one business day. See private mortgage costs and fees for the full three-bucket breakdown this disclosure has to reflect.
Don't start the clock late: Because the disclosure timing rule is measured in business days before a specific transaction event, build this document early enough that a slow signature from the client doesn't put the closing date at risk.
Step 5. Line up the legal and registration package
Confirm early whether the borrower is responsible for the lender's legal costs in addition to their own, since that's common on private deals and worth flagging before the client is surprised by the statement of adjustments. Line up the borrower's lawyer, confirm registration priority for a second mortgage, and confirm whether independent legal advice is required or simply recommended for this specific product and lender.
Step 6. Document the exit strategy before the file is considered complete
A private or B-lender file isn't truly complete without a written exit strategy on record — see private mortgage exit strategies for what makes one credible. Use the Private Exit Strategy Planner to capture the specific path and milestones at origination, not as an afterthought once the term is already underway.