True Cost of Borrowing Calculator: Your Net Advance

Typically a lender fee of 1–2% and a broker fee of 1–2% of the loan, plus legal costs (often $1,500–$3,000 covering both sides) and an appraisal (~$400–$600). Most are deducted from the advance, which is why the money that arrives is less than the amount you borrowed.

Fees and costs come off the top — that’s your net advance. Borrow $100,000 with 2% + 2% fees and ~$3,000 of legal and appraisal costs and about $93,000 lands in your account, while interest accrues on the full $100,000. Always plan from the net figure.

Private first and second mortgages generally run 9–14% depending on loan-to-value, location, and the story on the file. B-lender alternatives run about 5.99–7.99% when the file qualifies — part of a broker’s job is testing whether you can skip private pricing entirely.

Yes — FSRA-licensed brokers must disclose every fee in writing before you commit, and Ontario law adds extra disclosure rules and cooling-off protection when total costs are high. If someone won’t put fees on paper, walk away.

As a bridge, yes: stopping a power of sale, closing a purchase a bank declined late, or consolidating debt that costs more than the private rate. The discipline is the exit — a 12–24 month plan back to a B lender or bank so the expensive money is temporary.

The rate is the interest charge alone; the APR folds fees into the true annual cost. A 10% private mortgage with 4% total fees on a one-year term costs roughly 14% APR — the calculator above shows this all-in figure for your numbers.