Private Commercial Lending in Nova Scotia: Costs, Uses & When It Makes Sense
Not every good deal fits a bank. When the timeline is tight, the property is transitional, or the borrower's story needs explaining, private lending is often the tool that gets a commercial deal done. This guide covers what private commercial lending actually costs in Nova Scotia, when it's the right call, and — just as importantly — when it isn't.
General information from the Indi Mortgage Commercial Division team — not financial advice. Ranges below are typical market context as of mid-2026; private pricing is set deal-by-deal and moves constantly, so treat any figure as illustrative and confirm current pricing on your specific deal.
In short: private commercial lending is short-term financing from non-bank lenders, priced on the property and the exit rather than the borrower's income. It costs more than a bank — in Nova Scotia, rates are commonly in the high-single to mid-teens, plus lender and broker fees of roughly 1–3% — and it earns its keep when speed, flexibility, or a transitional property makes conventional financing impossible in the moment.
What private lending is
A private lender is a non-bank source of capital — a mortgage investment corporation (MIC), a fund, or an individual — that lends against commercial real estate. Unlike a bank, a private lender leads with the asset and the exit, not the borrower's income and covenant. That's why private money can close a deal a bank would decline or take months to approve. The trade-off is cost: you pay more for speed, flexibility, and a lender willing to take a view the bank won't.
Who uses it, and why
Private financing tends to solve one of a few problems:
- Speed — closing a purchase before a conventional approval could ever come together.
- Transition — a property mid-renovation, mid-lease-up, or otherwise not yet "stabilized" enough for a bank.
- Story — a strong deal with a borrower or structure that needs explaining (recent credit event, complex corporate structure, land or spec).
- Bridge — covering a gap before a refinance, sale, or construction takeout. → Bridge financing explained
What it costs in Nova Scotia
Private pricing is a negotiation, not a posted rate — it moves with the deal's risk, the position of the loan, and the market. As a rough guide to the Nova Scotia market as of mid-2026:
| Conventional / bank | Private commercial | |
|---|---|---|
| Interest rate | Lowest available | Higher — commonly high-single to mid-teens, by risk and position |
| Lender + broker fees | Minimal | Typically ~1–3% (plus any broker fee) |
| Term | Multi-year | Short — often 6–24 months |
| Loan-to-value | 65–75% | Usually more conservative, especially on land or spec |
| Speed to close | Weeks to months | Days to a few weeks |
| What's underwritten | Income + covenant | The asset + the exit |
Some Atlantic-Canada private lenders publish their rates — for example, East Coast Private Lending posts figures like 12.99% and 15.99% depending on the product — which is a useful reference point for what transparent private pricing looks like in this market. Your actual number depends on the property, the position (first vs. second mortgage), the loan-to-value, and your exit.
When private lending makes sense
The math works when the private loan unlocks value that outweighs its cost — a below-market purchase price, a repositioning that lifts income, or a deal you'd otherwise lose. Because the loan is short-term, the higher rate is paid for months, not years, and is then replaced by cheaper permanent financing. The single most important part of any private deal is a clear, credible exit — the refinance or sale that pays it off.
When it doesn't
Private lending is the wrong tool when there's no real exit, when a conventional or CMHC-insured option is available with a bit more time, or when the deal only works if nothing goes wrong. If a property already qualifies for bank or CMHC-insured financing, paying private rates is usually a mistake. A good broker will tell you when not to use private money.
First vs. second mortgages
Private capital sits in whatever position the deal needs. A first mortgage is the senior loan against the property; a second sits behind an existing first and carries a higher rate because it's repaid after the senior lender. Second-position private financing can top up leverage or fund a short-term need without disturbing a good first mortgage — but the cost and risk rise with the position.
How Indi approaches private deals
We treat private money as a bridge to a plan, not a destination. Before recommending it, we pressure-test the exit — the income, the timeline, and the takeout lender — so a private loan solves a problem instead of creating one. And because we place across the whole market, we can weigh a private option honestly against the conventional and CMHC-insured alternatives rather than defaulting to the fastest close.
Next steps
- Model your deal's economics: commercial mortgage feasibility calculator
- Talk through a time-sensitive or transitional deal: (902) 298-0218
- Related: Bridge financing · CMHC vs. conventional financing · The complete guide to commercial mortgages in Nova Scotia
Sources
- East Coast Private Lending — an Atlantic-Canada private lender that publishes indicative rates
- Bank of Canada — Canadian bond yields — the benchmark conventional pricing (the private-lending alternative) moves with
Indi Mortgage Commercial Division — private, bridge, and conventional commercial financing across Halifax and Nova Scotia. General information only; private rates and fees are set by lenders, vary by deal, and change constantly. Not financial advice.