Agreement of Purchase and Sale  TOP

	A contract by which one party agrees to sell and another agrees to purchase.

Amortization  TOP

	The gradual repayment of a debt by means of partial payments on the principal at regular intervals. The amortization period is the time required to repay the debt completely.

Appraisal  TOP

	Process by which the mortgage lending value of a property is determined.

Bridge Financing  TOP

	Interim financing to bridge between the closing date on the purchase of the new home and the closing date on the sale of the current home.

Broker  TOP

	An intermediary between the buyer and seller who is licensed to carry out such activities.

Building Permit  TOP

	A certificate that must be obtained from the municipality by the property owner or contractor before a building can be erected or renovated.

Closing Date  TOP

	The date of which the sale of the property becomes final and the new owner  takes possession.

Commitment  TOP

		A notice from a mortgage lender to a prospective borrower that the lender will advance mortgage funds of a specified amount under certain conditions.

Condition  TOP

	A clause in a contract that calls for the happening of some event, or performance of some act before the agreement becomes binding.

Conditional Offer  TOP

	An offer to purchase subject to specified conditions. These conditions could be the arranging of a mortgage, or the selling of a present home. Usually a time limit in which the specified conditions must be met is stipulated.

Conventional Mortgage  TOP

		A mortgage loan of up to a maximum of 75% of the lending value of the property for which a lender does not require loan insurance.

Bridge Financing  TOP

		The percentage of the borrower’s income that will be used for monthly payments.

Default  TOP

		Non-payment of installments due under the terms of the mortgage.

Deposit  TOP

	Payment of money or other valuables in consideration as a pledge for fulfillment of the contract.

Discharge  TOP

		The removal of all mortgages and financial encumbrances on the property.

Easement:   TOP

		The right acquired for access to or over another person’s land for a specific purpose, such as for a driveway or public utilities.

GDSR  TOP

	Gross Debt Service Ratio is a primary   calculation used by lenders and mortgage insurer   to determine an applicant's ability to service their   respective mortgage request. The   calculation is determined as follows:
	Mortgage Principle, Interest & Taxes + Heating Cost and/or 1/2 of Condo Fees   Gross annual income of borrower(s)

High Ratio Mortgage  TOP

	Loan that exceeds 75% of the property’s lending value, and which is insured through a mortgage insurance plan.

Hold-back  TOP

	An amount of money withheld by the lender during the progress of construction of a house to ensure that construction is satisfactory at every stage. The amount of hold-back is generally equivalent to the estimated cost to complete construction.

LTT  TOP

Land Transfer Tax Refund Program

Mortgage Insurance Premium  TOP

	A premium which is added to the mortgage and paid by the borrower over the life of the mortgage. The mortgage insurance insures the lender against loss in case of default on the part of the borrower.

Mortgage Life Insurance  TOP

	A form of reducing term insurance available for all mortgagors. In the event of a death of the owner or one of the owners, the insurance pays the balance owing on the mortgage. The intent is to protect survivors from losing their home.

Mortgage Loan Insurance (High Ratio)  TOP

	High ratio mortgages must be insured through CMHC (Canada Mortgage and Housing Corporation) or GENCOR (G.E. Capital Corporation). These Insurers guarantee the risk of lending to home buyers who need a high ratio mortgage. An insurance premium is paid by the borrower on behalf of the lender. The insurance premium that is paid to CMHC is to protect the lender in the event that the mortgage is not paid. This is not life, disability, or job loss insurance. The insurance premium is calculated as a percentage of the mortgage amount, depending on the loan to value, and may be added to the mortgage amount. The premiums are as follows:
	Loan to Value Premium
			Up to and including 65%	0.50%
			Up to and including 75%	0.65%
			Up to and including 80%	1.00%
			Up to and including 85%	1.75%
			Up to and including 90%	2.00%
			Up to and including 95%	2.75%
	Other high ratio financing costs may include an appraisal of $350.00+/- plus 8% PST on the insurance premium.

Mortgagee  TOP

	The entity who lends the money.

Mortgagor  TOP

	The entity who borrows the money.

Mortgage Term  TOP

	The actual length of time money is loaned at the contractual rate of interest. Terms range from three months to twenty five years. Traditionally the longer the term the higher the rate.

Mortgage Types  TOP  

	Pre-Approved Mortgage Conventional Mortgage High-Ration Mortgage - CMHC / GE Capital Insured First Mortgages Open Mortgages Closed Mortgages Fixed-Term Mortgages The Adjustable Rate (A.R.M.) Mortgage Secured Lines of Credit Equity Mortgages Multiple Term Mortgages The 6 Month Convertible Mortgage All-Inclusive-Mortgage (A.I.M.) Bridge Financing

   ► Open Mortgage  TOP

	Allows borrowers to repay a portion or the total amount of their mortgage at any time without penalty. Ideal for those who plan to sell their homes in the near future.

   ► Closed Mortgage  TOP

	A good choice for those that want security in knowing their monthly payments are fixed for a certain term. Lacks the option of repaying the entire amount of the mortgage upon request.

   ► Conventional Mortgage  TOP

	Regulations under The Bank Act prohibit lenders from lending in excess of 75% of the purchase price or the appraised value of a property without obtaining Hi-Ratio Insurance. A loan for up to 75% of the purchase price of a property is a conventional mortgage.

   ► Convertible Mortgage  TOP

	A short term mortgage usually six or twelve months, allowing the borrower to switch into a longer term at any time without penalty.

   ► High Ratio Mortgage  TOP

	A loan for 75% to 95% of the purchase price of a property.

   ► Variable Rate Mortgage  TOP

		A mortgage where payments can be fixed from one to five years, but the interest rate could change from month to month or quarterly depending on market conditions. Payments and balance outstanding are adjusted accordingly.

   ► First Mortgage  TOP

		Mortgage given the first priority at the registry office. Can be conventional or high ratio. They give borrowers the best rate of interest.

   ► Second Mortgage  TOP

	A higher interest rate loan that provides borrowers with additional financing if the first mortgage does not meet their total financial requirements.

T.I.P.P.'s  TOP

Tax Installment Payments Plan - for property taxes.

Offer to Purchase  TOP

		A written contract setting forth the terms under which a buyer agrees to purchase a property. Upon acceptance by the seller, it forms a contract, which will form the basis for the final document to be prepared by a lawyer or notary. It includes the legal and/or municipal description (this may consist of lot numbers as well as street address), purchase price, closing date, mortgage and terms of repayment, and lists specific items included as part of the sale.

P&I&T  TOP

	Principal, interest and taxes due on a mortgage.

P&I  TOP

	Principal and interest due on a mortgage.

Penalty  TOP

	A sum of money paid to a lender for the privilege of prepaying a mortgage in part or in full.

Power of Sale  TOP

	The right of a mortgagee to force the sale of the property without judicial proceedings should default occur.

Prepayment Option  TOP

		The right to prepay a specified amount of the principal balance. Penalty interest may be incurred on prepayment options.

Prepayment  TOP

		Full or partial payment of all or part of the principal, separate from the regular payments called for under a mortgage agreement.

Principal  TOP

	The amount owing to the lender at any time.

Purchase Plus Plan  TOP

		The Purchase Plus Plan lets you add the cost of improvements to your home onto your mortgage.

Rate (interest)  TOP

	The return the lender receives for loaning you the money for the mortgage.

Real Estate  TOP

	Includes real property, leasehold and business whether with or without premises, fixtures, stock in trade, good of chattels in connection with the operation of the business.

Roll-Over Mortgage  TOP

	A mortgage loan where the interest rate is established for a specific term. At the end of this term, the mortgage is said to "roll-over" and the borrower and lender may agree to extend the loan. If satisfactory terms cannot be agreed upon, the lender is entitled to be repaid in full. In this case, the borrower may seek alternative financing.

Sales Representative  TOP

	A licensed employee of a Real Estate Broker authorized to trade in real estate.

Survey  TOP

	The accurate mathematical measurement of land and building there on.

TDSR  TOP

	Total Debt Service Ratio is a secondary calculation used by lenders and mortgage insurers to determine an applicant's ability to service their respective mortgage request in addition to their other debt obligations. The calculation is determined as follows:
	Mortgage, Principle Interest & Taxes + Heating Costand/or 1/2 Condo Fees + All Other Debts   Gross annual income of borrower(s)

Term  TOP

	The length of time which you pay a specific interest rate on your mortgage loan. At the end of the term you may repay the balance of the loan or re-negotiate at current rates and conditions.

Title  TOP

Evidence of ownership.

Vendor Take Back  TOP

	Where the seller of a property provides some or all of the mortgage financing in order to sell the property.

Zoning Laws  TOP

	Municipal laws restricting the use of land for special purposes.

- Apply Now -