Over the course of 2025, most brokers have seen both new opportunities and new challenges: originations are up, but client needs are more complex. Many existing mortgage holders with pandemic-era mortgages signed at historically low rates are now facing renewal shock, with payments rising by 15-20%.
Others have seen hours cut or jobs disappear altogether, particularly in trade-sensitive industries. And a growing number of borrowers are self-employed or gig workers whose income doesn’t fit the borrower profiles prime lenders are looking for.
The opportunities are significant, but putting clients in the right mortgage solutions — and structuring them well — is essential to ensure borrowers remain on solid footing at their next renewal. Brokers can make the most of the 2026 market by understanding where demand is coming from and ensuring mortgage payments stay manageable for clients in unpredictable markets.
Where 2025 demand is coming from
2025 saw a cooling housing market, but roughly 60% of all outstanding mortgages will renew in 2025 or 2026. Many of these borrowers locked in five-year fixed terms when rates were at historic lows – and they’re now renewing into a market where even reduced rates represent a significant jump from what they were paying. The Bank of Canada’s policy rate has come down to 2.25% from its 5% peak, but that relief hasn’t fully translated to monthly payments for variable rate borrowers whose original terms were signed around 1%.
Meanwhile, the household debt-to-income ratio reached 174.9% in the second quarter of 2025, meaning Canadians now owe $1.75 for every dollar of disposable income. The national mortgage delinquency rate has ticked down slightly to 0.22% in the second quarter of 2025, but Ontario and British Columbia are telling a different story: Toronto’s delinquency rate jumped 60% year-over-year to 0.24%, the highest rate since 2012.
However, there’s some relief in sight for borrowers; new OSFI legislation has made the lending market more competitive by allowing uninsured borrowers to switch lenders more easily, creating new demand for better borrowing options.
At the same time, CMHC expects a gradual housing market recovery in 2026 as economic confidence improves and trade tensions ease — creating new opportunities for brokers who can match borrowers with the right solutions.
Borrower profiles to prepare for in 2026
As you build your 2026 business plan, four borrower profiles are worth prioritizing, each with their own structuring considerations.
Borrowers facing renewal shock
Borrowers whose monthly payments are jumping significantly at renewal may need a private solution to bridge to better circumstances – whether that’s rebuilding credit, waiting for rates to ease further, or selling a property in a slower market. Private mortgages can offer flexible features, such as pre-paid options or interest-only payments, which provide immediate cash flow relief and give borrowers valuable time to stabilize their finances or plan their next move.
The key structuring question is the exit strategy: what needs to change for this borrower to return to conventional financing, and is that realistic within a one- to two- year term? Stress-test the plan to ensure the exit is viable. If it depends on rates dropping or property values increasing in the near term, it could be a risky strategy. For these borrowers, more reliable exit strategies depend on credit repair, debt paydown, and income stabilization strategies within the borrower’s control.
Borrowers looking to consolidate debt
With household debt elevated and credit card delinquencies rising faster than mortgage delinquencies, many borrowers are looking to roll high-interest consumer debt into their mortgage.
This can work if consolidated payments will truly allow the borrower to reduce reliance on credit. Since the mortgage balance will increase, conservative loan-to-value is especially important in this scenario. The exit strategy depends on the borrower demonstrating improved financial behaviour, so look for signs they understand what got them into trouble and have a plan to avoid repeating it — for example, closing or reducing revolving facilities, such as lines of credit or credit cards, to avoid an ongoing cycle of debt accumulation and overextension.
Buyers looking for bridge mortgages
In a market where transactions are taking longer, buyers may need to close on a new property before their existing home sells. In this scenario, a slower or less profitable sale could cause costs to accumulate too quickly for the borrower to manage.
To ensure the best possible outcome for the borrower, focus on:
- Timeline: How long until the existing property sells and the bridge loan can be paid out? Is that realistic given current market conditions?
- Security: What’s the lender’s position on the property, and what’s the combined loan-to-value across all the debt registered against it?
Leave some room for the borrower to carry both properties for longer than planned if they have to, and ensure there’s enough equity that a lower price point won’t cause a crisis. This creates a backup plan with some cushion to account for fluctuating market conditions.
Self-employed and non-traditional buyers
Self-employed and gig workers continue to face qualification and documentation hurdles with traditional lenders. Prime lenders are increasingly pulling income data directly from CRA records rather than relying on borrower documentation. These borrowers may have the income to support a mortgage, but aren’t able to provide the proof that A-lenders require.
Bank statements, contracts, invoices, and a brief narrative explaining the business can help alternative lenders understand the borrower’s complete financial picture. For borrowers with variable income, look at a longer history to show consistency and be conservative when assessing the payment amount they can support.
Across all these scenarios, a few common principles hold:
- Conservative loan-to-value protects everyone: Thoughtfully determined loan-to-value ratios provide a cushion to preserve borrower equity and limit losses if property values soften.
- Strong documentation: A clear picture of income, logical explanation for credit blemishes, and a credible exit plan all contribute to mortgages that underwrite cleanly and service well through the term.
The goal is to structure the deal to deliver the best possible outcome for your client while reinforcing your reputation as someone who delivers solutions, not just completes transactions.
How CMI can help you support borrowers in an uncertain market
At CMI, we partner with brokers to structure mortgages that align with both borrower needs and sound underwriting standards. Our private lending approach is grounded in disciplined underwriting and active servicing, protecting borrower equity and investor capital alike. Working with us means collaborating with a partner who understands the nuances of non-prime lending and focuses on smart, sustainable solutions.
If you’re building your 2026 business plan and want to talk through how private lending fits into your client strategy, get in touch to learn more.
