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The Private Mortgage Loan Agreement is essential for transactions where private individuals or non-institutional entities provide mortgage financing in Canada. This document is commonly used when borrowers seek alternatives to traditional bank financing, whether due to unique property characteristics, credit requirements, or specific financing needs. The agreement must comply with Canadian federal legislation such as the Interest Act and provincial mortgage regulations, while protecting both lender and borrower interests. It typically includes comprehensive terms covering loan specifics, security arrangements, property details, borrower obligations, and enforcement mechanisms. This type of agreement is particularly relevant in markets where private lending plays a significant role in real estate financing and requires careful attention to both federal and provincial regulatory requirements.

1. Parties: Identifies and provides full legal details of the lender and borrower

2. Background: Explains the context of the loan agreement and the parties' intention to enter into a mortgage arrangement

3. Definitions: Defines key terms used throughout the agreement for clarity and legal certainty

4. Loan Amount and Purpose: Specifies the principal amount being lent and the purpose of the loan

5. Interest Rate and Calculation: Details the interest rate, calculation method, and frequency of interest charges

6. Term and Repayment: Specifies the loan duration and repayment schedule, including payment amounts and frequencies

7. Security: Describes the property being mortgaged and the security interest being granted

8. Property Details and Representations: Contains details about the mortgaged property and borrower's representations regarding ownership and condition

9. Borrower's Covenants: Lists the borrower's ongoing obligations regarding property maintenance, insurance, and other requirements

10. Events of Default: Defines circumstances that constitute default and the lender's remedies

11. Enforcement Rights: Outlines the lender's rights and remedies upon default

12. General Provisions: Includes standard clauses like notices, amendments, assignments, and governing law