Who orders this
- Private lenders and individual investors
- Mortgage investment corporations (MICs) and their underwriters
- Brokers placing private first and second mortgages
- Lawyers coordinating private loan closings
Why private lender appraisals carry more weight
Private lending decisions lean on equity more than on income or credit. If the borrower cannot pay, the lender looks to the property, so the value, its marketability and how long it might take to sell matter a great deal. Many private lenders and MICs keep loan-to-value limits tighter than banks and read the appraisal closely for condition issues, unusual features and market trends.
- Bridge loans between buying and selling
- Borrowers with self-employed, new or bruised credit profiles
- Short-term construction or renovation financing
- Equity take-outs where bank criteria do not fit
Getting the scope right before you order
Private lenders differ in what they want to see. Some ask for a full interior inspection on every deal, some accept a drive-by on lower-risk files, and some ask the appraiser to comment on marketability or an estimated exposure time. Confirm the scope, the lender’s legal name and any approved appraiser list before ordering. If the lender is not chosen yet, waiting a day can save paying for a second report.
Good to know in Ontario
In Ontario, MPAC assesses property for municipal tax. Its assessed value is not an appraisal, and lenders, courts and the CRA rely on an appraisal of market value on a specific date.
Frequently asked questions
Do private lenders require an appraisal in Vaughan?
Most do, because the property is their main security. The appraisal should be addressed to the private lender or MIC funding the loan. A few may accept a recent existing report with a transfer letter, but many insist on their own.
Who pays for a private lender appraisal?
The borrower usually pays, often alongside lender and broker fees. AppraisalDesk lets the broker send a secure payment link to the borrower, and the report is released online once paid, so the lender receives it without anyone chasing payment.
Can a private lender use an appraisal done for a bank?
Sometimes, if the appraiser issues a letter transferring reliance and the lender accepts it. Many private lenders and MICs prefer a report addressed directly to them. Ask before relying on an existing report.
Will a private lender accept a drive-by appraisal?
Some do for lower loan-to-value files or properties in well-understood markets. Others always want an interior inspection. The lender sets the rule, so confirm it before you choose the scope on your order.