Private Lending Glossary
A plain-language starting point for private-lending terminology. These explanations provide general context; the meaning and legal effect of a term depend on the jurisdiction and transaction documents. Comparing Canadian and U.S. terms? See the Cross-Border Lending Dictionary.
14 of 14 terms
- Broker
- An intermediary connecting participants in a financing transaction. The services and authorization associated with the role depend on the jurisdiction.
- Business purpose
- A description of the intended commercial or investment use of loan proceeds. The label alone does not resolve regulatory treatment.
- Collateral
- An asset supporting an obligation. The rights and remedies associated with it depend on the security documents and applicable law.
- FSRA
- Financial Services Regulatory Authority of Ontario, a regulator with responsibilities that include Ontario’s mortgage-brokering sector.
- Loan participation
- An arrangement in which another participant takes an interest in a loan under the agreed structure and documents.
- Loan to value
- A comparison of a loan amount to the value used for the supporting property. The valuation basis and treatment of other debt should be stated.
- Maturity
- The date on which the loan is scheduled to become due under its terms.
- MIC
- Mortgage investment corporation, a Canadian investment structure subject to specific tax and operational requirements. The label does not determine suitability.
- Mortgage and deed of trust
- Forms of real-estate security terminology used in different jurisdictions. Their structure and enforcement require jurisdiction-specific review.
- NMLS
- Nationwide Multistate Licensing System, used for licensing and registration administration in relevant U.S. financial-services activities.
- Originator
- A person or business involved in bringing a proposed loan through the initial application and lending process. The term is used differently across markets.
- Private lender
- A person or organization providing financing outside the conventional bank channel. Business models and regulatory treatment vary.
- Servicing
- Administration of a loan after closing, including activities such as payment tracking, records and borrower communications.
- Underwriting
- The evaluation of a proposed loan, borrower, collateral and repayment plan under the lender’s criteria.
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