Private lenders demand delinquent Canadian homeowners pay up

Canadian homeowners grappling with swelling mortgage costs have become such a significant issue that the government of Prime Minister Justin Trudeau is urging banks to go easy on them.

Nick Kyprianou, the chief executive officer of RiverRock Mortgage Investment Corp., is taking more of a tough-love approach.

Mortgage investment corporations — or MICs — like Kyprianou’s firm are navigating a tricky situation. The surge in borrowing costs has squeezed many homeowners, a problem more acute among MIC borrowers given that their loans often carry an interest rate of 10 per cent or more. But the companies don’t have the resources of Canada’s massive banks, meaning MICs often argue that they can’t afford to let stretched customers skip payments for as long, and have to act more quickly to stem losses.

So as soon as someone misses a payment, Kyprianou’s company reaches out to see if they can get back on track. If the answer is no, they deliver an ultimatum: Sell now or we’ll sell for you.