We understand why you think that. Here is what no one has ever shown you.
↓Private financing is often said to cost too much. The real question is: what does time cost you? Land you have already acquired that sits idle generates no income. Meanwhile, taxes keep running, interest keeps running, and business opportunities pass you by. Our objective is not to be the cheapest option. Our objective is to let you move forward quickly, without that speed costing you more in the end.
We do not claim that private financing costs less.
We demonstrate that it does not necessarily cost more
when the full cost of the project is taken into account.
CMHC's rate of 4.75% looks unbeatable. Except it does not cover what follows.
CMHC takes 6 to 18 months to approve a construction file. During that time, your land costs you 8.5 % / year in private bridge financing — and generates zero income. Good news: these interest charges are immediately tax-deductible (ITA s. 20(1)(c)).
CMHC processes its disbursements in 45 to 90 days. Contractors finance their own line of credit in the meantime — and build it into their bids. An extra 2 to 3% on the contract. Capital Norvex pays in 30 days; contractors pass the discount directly back in their quote.
With CMHC, your building collects its first rental income at month 31. With Capital Norvex, at month 19. Those 12 months of rent never come back — it is money permanently forfeited.
Interest on borrowed money used to earn rental income is tax-deductible under the ITA. On a nominal rate of 12 %, the government absorbs 3.18 percentage points. Your effective cost is only 8.82 %.
All figures are verifiable. Sources at the bottom of the page.
▲ Click a tab to compare your market
| 🏢 PATH A — CMHC only | ⚡ PATH B — Capital Norvex | |
|---|---|---|
| First rental income collected | Month 31 12-month wait + 18 months of construction | Month 19 Construction starts immediately |
| Land carry (12-month CMHC wait · 8.5 %) | $212,500 $510,000 $382,500 | $0 ✓ |
| Construction financing interest 18 months · interest on disbursed amounts only · progressive draw · 50% average balance |
4.75% × $15M × 50% × 1.5 yrs $534,375 |
12% × $15M × 50% × 1.5 yrs $1,350,000 |
| Arrangement / origination fees CMHC: ~1% bank commitment fee · Norvex: 3% |
$150,000 ~0.75%–1.00% · QC/ON bank market 2026 |
$450,000 |
| CMHC MLI Select insurance premium 3.92 % · 100 pts · LTV 75 % |
$588,000 | $588,000 permanent CMHC refi, identical |
| Contractor discount 30-day payment (Norvex) vs. 90-day (CMHC) |
— none — | − $350,000 $280,000 $400,000 |
| ITA tax deduction s.20(1)(c)/(e) Corporate tax rate QC & ON 2026 = 26.5 % |
− $237,672 $316,509 $282,722 | − $477,000 |
| Net financing cost (excl. rental income) | $1,247,203 $1,465,866 $1,372,153 | $1,561,000 $1,631,000 $1,511,000 |
| NOI for 12 extra months (month 19 → 30) Revenue that PATH A never collects |
— $0 — | + $978,120 $975,156 $1,244,880 |
| Final net result |
$1,247,203
$1,465,866
$1,372,153
First rent at month 31
|
+ $664,323 ahead
+ $810,022 ahead
+ $1,106,033 ahead
First rent at month 19
|
When you add up the 3 hidden costs, reality is exactly the opposite of the initial intuition.
Capital Norvex