Direct answer
The term ends; the remaining mortgage balance still has to be dealt with
When a private mortgage reaches maturity, the existing term ends but the debt does not disappear. The balance must be repaid, refinanced, renewed, extended or resolved through another agreed or legal process. Renewal is not automatic.
At maturity, the remaining balance is due under the mortgage contract
A private mortgage commonly has a short term—often much shorter than the amortization used for a bank mortgage. When that term ends, any remaining balance must be repaid or otherwise dealt with under the contract.
If the mortgage was interest-only, the borrower may have made every scheduled payment and still owe essentially the full principal at maturity.
There are several possible maturity outcomes
The borrower may refinance with an A lender, B lender or another private lender; repay from cash or an asset sale; sell the property; accept a renewal or extension from the current private lender; or negotiate another solution if available.
Which option is realistic depends on current income, credit, property value, mortgage balance, timing and lender policy. A plan that was possible at closing can become unavailable if any of those inputs deteriorate.
The lender does not have to renew
FSRA specifically tells private-mortgage borrowers to ask what happens if they still cannot qualify for traditional financing at the end of the term and whether the lender will offer renewal. A renewal can involve a new rate, fee and set of conditions.
The borrower should therefore never treat “the lender will probably renew” as the only exit strategy.
If the balance remains unpaid, default and enforcement risk can arise
A mortgage is a legally binding contract. If the amount due at maturity is not paid and no renewal or extension has been agreed, the borrower can be in default and the lender may exercise contractual and statutory remedies.
If a borrower receives a demand, notice of sale or other legal correspondence, immediate Ontario legal advice is appropriate. A financing review cannot determine legal rights or deadlines from incomplete facts.
Do not start the exit in the final week
Refinancing can require updated income documents, credit review, appraisal, lender conditions and legal closing. A sale can take months. Even a same-lender renewal may require valuation and new disclosure.
The practical goal is to know well before maturity whether the original exit is working. If it is not, there is still time to compare a cheaper lender, negotiate a short extension, add funds or prepare a sale rather than accepting the only option left at the deadline.
Evidence and factual governance
Sources and verification
This knowledge resource is governed by the primary or authoritative sources below. Sources were last checked on August 14, 2026. Product availability, lender policy and individual legal or tax consequences must still be confirmed for the actual transaction.