Short answer
A straw buyer lends their name, credit or identity to a purchase or mortgage for someone whose true involvement is hidden. The person signing can become responsible for the debt, taxes and legal consequences. Do not sign documents for a property you do not genuinely understand and own as disclosed.
The client problem
A friend offers money for using the client’s good credit and says payments will be handled by someone else. The lender is not told who controls the property.
A practical Ontario example
The registered buyer signs the mortgage but provides no down payment and will not occupy or manage the home. Those facts must be disclosed and professionally reviewed, not hidden behind a private promise.
Legitimate routes may still exist
A truthful file may be assessed through standard A lending, alternative/B lending, or an MIC/private solution depending on income, credit, equity, property and timing. No lender route makes false information acceptable.
Policy boundary: FSRA regulates mortgage-brokering conduct in Ontario; lenders still set their own underwriting policies. Fraud-prevention duties do not authorize altering or hiding application facts.
Questions to ask now
- Who supplied the money?
- Who will control and use the property?
- Who receives rent or sale proceeds?
- Does the lender know every beneficial party?
Rajiv’s practical view
If ownership is shared, document it transparently with the lender and independent lawyers. Payment for secrecy is a reason to stop.
Source and context
General Ontario education. Results depend on the contract, lender, administrator, property, equity, documents and legal advice. No approval or legal outcome is promised.
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Rajiv Verma, Mortgage Broker · Ontario