General information only. This article is educational and is not financial, legal, tax or investment advice, or an offer to lend or invest. Get advice from qualified professionals about your situation.
Calgary moves fast. A property comes up, a contract lands, or equipment has to be bought before a project starts, and the bank process doesn't always keep pace. A private lender can close that gap. This guide covers how private lending works in Calgary, who it suits, what a lender like Diamond Ridge looks at, and how to put together a request that gets a clear answer.
What a private lender is
A private lender is a company or group that lends its own capital, or capital it manages, outside the bank and credit union system. Banks follow rigid rules built around income ratios and credit scores. Private lenders can look at the whole deal: the asset behind it, the plan to repay, and the people involved.
Diamond Ridge is a group of entrepreneurs with backgrounds in energy, oilfield services, real estate and operating businesses. That experience shapes how we read a deal: we can often see value in an asset or a business plan that a standard checklist would miss.
Who uses private lending in Calgary
Private financing isn't only for people a bank has turned down. Common situations include:
- Real estate investors who need to close quickly, buy a property that needs work, or fund a project between phases.
- Self-employed borrowers whose tax returns don't reflect what their business actually earns.
- Energy and oilfield companies financing equipment, inventory, or a contract before receivables come in. See our oil and gas equipment financing page.
- Business owners buying a company, buying out a partner, or funding growth that a bank sees as too early or too concentrated.
- Borrowers with credit issues who have strong security and a realistic way to repay.
What a private lender looks at
Every lender is different, but most private lenders weigh four things.
1. Security
What backs the loan? Real estate, equipment, inventory, receivables, or shares in a business can all serve as security. The lender wants to know what it's worth, how easily it could be sold, and what debt is already registered against it. Expect to provide an appraisal, a valuation, or other independent evidence.
2. The exit
How does the loan get repaid? A sale, a refinance with a bank, a contract payment, or business cash flow are all possible exits. A documented exit, such as a signed agreement, a commitment letter, or a purchase order, is much stronger than a projection.
3. The borrower
Credit history still matters, but it isn't the whole story. A private lender will want to know about your experience with this type of asset or business, your track record, and how you handled problems before. An honest explanation of a past issue usually carries more weight than leaving it out.
4. The structure
This is where private lending is most flexible. Terms can be built around the deal, for example interest-only payments, staged advances, a cross-collateral position, or a mix of debt and equity. A good deal can often be made to work with the right structure, even if it looks different from the original proposal.
Costs to compare
Private money costs more than bank money because it carries more risk and offers more flexibility. When you compare offers, ask for every cost in writing:
- the interest rate, and whether it's calculated monthly or annually;
- lender, broker and administration fees, and whether they're deducted from the advance;
- legal and appraisal costs;
- the prepayment terms and any minimum interest period;
- renewal or extension fees if your exit takes longer than planned.
Add these up into a total dollar cost over the term you realistically expect. For more detail, read our guide on how much private lenders charge and our comparison of a private lender vs a bank.
Speed, without empty promises
Fast access to funding is one of the main reasons people choose a private lender. Private lenders can often move faster than banks because the decision-makers are closer to the deal. Still, no honest lender can guarantee a timeline before seeing the file. Appraisals, title searches, legal work and third parties all affect closing. The best way to keep things moving is to send a complete package up front.
How to prepare a request
A clear, complete submission gets a faster and more useful answer. Include:
- A short summary: the amount you need, what it's for, the term you're asking for, and how you'll repay it.
- Security details: the address or asset description, any recent appraisal or valuation, and statements for any existing debt.
- Evidence of the exit: a sale agreement, a refinance letter, a contract, or receivables.
- About you or your company: identification, corporate documents, and recent financial statements if available.
- Anything unusual: a past credit issue, a tenant situation, or an environmental question. Raising it early builds trust.
Deal sizes and where we lend
Diamond Ridge reviews deals from $2,000 to $12,000,000. Our offices are in Edmonton, Calgary and Kelowna, and we look at opportunities across Alberta, British Columbia and the rest of Canada. Our services include bridge loans, secured loans, second mortgages, high-risk lending, equipment financing, and equity and partnership structures. See all of them on our lending page, or learn how it works.
Submit your Calgary deal
If you have a property, a business or an equipment deal in Calgary that needs financing, submit the deal. Tell us the amount, the security and the exit, and our team will review it and reply by email.