• Mortgage

    The loan you borrow from a lender, to purchase a home.

    • First mortgage

    The mortgage in first position on the property that was used to secure your mortgage loan. If you ever defaulted on your loan, the lender in first position would be repaid before any other lenders you had used your home as security to borrow money from.

    • Second Mortgage

    An additional loan taken out on a property that is already mortgaged. For the lender, this is riskier than the first mortgage, because they are in second position on the property's title. If the homeowner defaulted on their payments and the property was taken into possession, the lender in first position would always be paid out first, whereas the lender in second position runs the risk of not being repaid. To compensate for this risk, mortgage rates for second mortgages are always higher than for principal mortgages.

    • Self-Employed Mortgage

    The mortgage financing process those who are self-employed must go through, which includes submitting personal tax Notices of Assessment with the mortgage application, and potentially even some third-party income validation. There are, however, some lenders who cater to the self-employed and will look at credit history over income generation.

    • Private Mortgage

    A short-term interest-only loan taken out by someone who does not qualify for prime or bad credit lending. Private mortgages have an average amortization of 1-3 years, during which time the borrower only pays off the interest accumulated each month; at an annual rate of 10-18%, the payments are not cheap. At the end of the term, most homeowners transfer their private mortgage to a traditional lender.

    • Home Equity Line of Credit

    A home equity line of credit (HELOC) is a revolving line of credit secured by your home that offers a lower interest rate than a traditional line of credit. Through a HELOC, you can borrow up to 65% of the value of your home minus the outstanding balance of your mortgage. Note, however, that your mortgage balance + HELOC cannot equal more than 80% of the value of your home (meaning you must always maintain 20% equity).

    • Mortgage Renewal

    At the end of your current mortgage term, if you still have a balance on your mortgage, you will need to renew it for another term. It’s important to shop around for the best mortgage rate and product before your maturity date, otherwise your lender may automatically renew your mortgage for another term.

    • Refinancing

    Your home equity - your home's value minus the balance of your mortgage - is available for you to withdraw and invest in a number of ways, including home renovations, additional real estate, post secondary education and much more. You can access up to 80% of your home equity by increasing the value of your mortgage through a refinance.

    • Assumable Mortgage

    A mortgage that can be transferred from the seller to the buyer. When assuming a mortgage, the buyer also needs to pay the seller the difference between their purchase price and what’s leftover on the mortgage.

    • Bad Credit Mortgage

    A home loan option made for individuals with bad credit (scores below 640) who have been turned down by the major banks. The two most popular bad credit mortgage providers are trust companies and private lenders.

    • Blended Mortgage

    When you combine the mortgage rate from an existing mortgage with the mortgage rate from a new mortgage and blend them into a new rate somewhere in-between the two. You would get a blended mortgage to avoid breaking your mortgage early – to access equity and/or obtain a lower mortgage rate – and having to pay the prepayment penalty required to do so.

    • Bridge Financing

    A short-term loan, typically taken out for a period of 2 weeks to 3 years pending the arrangement of larger or longer-term financing. You would need bridge financing if you were stuck in a situation where the closing date for the home you are purchasing is before the closing date of the home you’re selling, leaving you without a down payment for the new home because it’s tied up in equity.

    • Collateral Mortgage

    A readvanceable mortgage product that allows your lender to lend you more money as your property value increases, without having to refinance your mortgage. One important thing to consider about collateral mortgages, however, is they cannot be transferred to another lender – not even at the end of your mortgage term.

    • New to Canada Mortgage

    The mortgage financing process that those who are new to Canada must undergo, which includes having to submit extra supporting documentation than permanent residents, and potentially needing to use one of the mortgage default insurance providers’ New to Canada mortgage programs.

    • Reverse Mortgage

    A mortgage product for homeowners who were mortgage-free but who want to borrow money against the value of their home. Commonly used by seniors, no repayment is required until the home is sold, or the homeowner dies.