Can private mortgages help with tax arrears?
Updated: February 28, 2026CanadaFAQPrivate lending
Quick Summary
Yes, private financing is often used to quickly clear CRA or property tax arrears when there is urgent enforcement risk.
When tax arrears create deadlines or legal pressure, a Private Mortgage can be a short-term tool to stabilize the situation.
How it typically works
- You borrow against available home Equity.
- Proceeds are used to pay arrears and stop escalation.
- You plan a lower-cost exit (refinance or sale) once the file is back in good standing.
What to be careful about
- Net advance: confirm the loan covers arrears plus fees and Closing Costs.
- Term risk: if the exit takes longer than expected, renewals can be expensive.
- Documentation and timing: arrears statements, title, and payouts should be gathered early.
Treat this as transitional financing with a clear timeline and backup plan, and have your lawyer review enforcement-related terms.