AAA mortgage that combines the amount the borrower owes under an existing mortgage with additional mortgage money required by the borrower. The interest rate for the new amount borrowed is a "blend" (or combination) of the interest rate of the "old mortgage" and the interest rate for the additional amount to be borrowed.
)AA regular installment payment composed of both Principal and Interest in which part of the money received is applied toward the principal of the loan and part is put to pay the interest. This is the norm for mortgage payments. Blended payments are separate from the concept of a Blended mortgage.
AThe Canada Mortgage and Housing Corporation is a federal Crown corporation established under the National Housing Act. CMHC's services include providing housing information and assistance to consumers and providing mortgage default insurance for high ratio mortgages.
%AA sum of cash that is required to be paid to the vendor by the purchaser. This money is a symbol of the purchaser's commitment to buy. If the offer is accepted, the deposit is applied to the down payment. If the offer is later turned down by the buyer, the deposit may or may not be returned.
Amortization
With a mortgage, the borrower agrees to pay back the amount borrowed over a period of time. This breaking of the loan into smaller parts to be paid back over uniform blocks of time is amortization.
Amortization Period
The actual number of years it will take to repay a mortgage in full. This period can be longer than the loan's term. For example, a mortgage may have a five-year term and a 25 year amortization period.
Appraised Value
An estimate of the market value of the home (and property) that the borrower pledges as security for the mortgage. This value may be more or less than the purchase price of the property.
Assets"The things of value that you own.
Blended Mortgage
Blended Mortgage Payment
Bridge Financing
A loan made for a short term, to "bridge" (or cover) the time gap between completing the purchase of one property and finalizing arrangements to pay for it. The need for this type of financing often results from mismatched closing dates.
Carrying Costs
The expenses of living in, and maintaining a home (and property). This includes mortgage payments, property taxes, heating, repairs and so on.
Closed Mortgage
A mortgage that cannot be prepaid, or renegotiated, unless the lender agrees and the borrower is willing to pay an interest penalty.
Closing DateXThe date the purchase of the property becomes final and the new owner takes possession.
Collateral Mortgage
A loan evidenced by a promissory note and backed by the collateral security of a mortgage on a property. The money borrowed is generally used for a purpose other than the purchase of a home, such as a vacation, or home renovations.
Conventional Mortgage
A first mortgage for the purchase of a home, of up to 75% of the property's appraised value or purchase price, whichever is lower.
DeedVA legal document that transfers and evidences ownership of the property to the buyer.
Default0Failure to repay an outstanding debt as agreed.
Deposit
$AThe percentage of a borrower's gross monthly income that can be used to pay the housing costs, including monthly mortgage payment (principal and interest), heating costs and property taxes (and condominium fees when applicable). The total should not be more than 32% of monthly gross income.
AThe length of time a lender will lend mortgage funds to a borrower. Most mortgage terms run from six months to five years. Certain lenders may offer longer terms (eg. 7 or 10 years). After this period, the borrower can either repay the balance (the remaining principal plus interest) of the mortgage, or renew the mortgage for another term. The total length of a mortgage is usually made up of several terms.
>AThe percentage of a borrower's gross (before tax) monthly income needed to cover payments for housing costs (principal, interest, taxes, condominium fees, heating costs) and all other debts and obligations (typically loans and credit cards). The total should not be more than about 40 percent of gross monthly income.
BAA mortgage for which the rate of interest fluctuates as the Bank's prevailing prime rate changes. While the regular payments you make stay the same for the term, the amount applied toward the principal changes according to the change (if any) in the rate of interest. This is also referred to as a Floating Rate Mortgage.
Down paymentRThe amount of money put forward by the buyer toward the purchase price of a home.
EquityfThe difference between the price for which a property could be sold and the total amount owing on it.
First Mortgage
A mortgage which is registered first against the property. This mortgage has to be paid first in the event of sale or default.
Fixed Rate Mortgage]A mortgage for which the rate of interest is fixed for the term (i.e. a set period of time).
Floating Rate Mortgage
See Variable rate mortgage.
Gross Debt Service Ratio
High Ratio Mortgage
A mortgage for more than 75% of either or both a property's appraised value and purchase price. In other words, the down payment amount is less than 25% of the purchase price/appraised value.
Interest
Interest is the cost of borrowing. It is the amount paid on the money borrowed. It is represented as an annual percentage rate applicable to the mortgage.
LiabilitiesQWhat you owe. For example: taxes, mortgages, car loans and credit card balances.
Maturity Date
The last day of the term of your mortgage agreement. The mortgage must be paid in full, or the agreement renewed, by this date.
Mortgage
A mortgage is both a loan used to purchase a home and a security for the repayment of the loan since the property purchased is pledged by the borrower to guarantee repayment.
Mortgage Loan Insurance~Government-backed or privately-backed insurance protecting the lender against the borrower's default on high-ratio mortgages.
Mortgage Life InsuranceKInsurance that pays off the mortgage debt should the insured borrower die.
Mortgage PaymentcThe regular installments made towards paying back the principal and paying interest on a mortgage.
Mortgagor
The borrower.
Multiple Listing Service (MLS)bA computer-based system for relaying information to real-estate agents about properties for sale.
A* This file was compiled by Vojta Krb. If anyone has any comments, suggestions, or criticisms. Please feel free to send me an email at: krb5071@acmail.mtroyal.ab.ca
* Please note that this is my schools email account. Since I am student from Sept-April, I will not be able to answer any questions that are sent to me outside of this time frame.
* I hope you find this file to be useful and informative.
* Thank you, and long live Psion !!
Open MortgagegA mortgage that can be prepaid or renegotiated at any time and in any amount without interest penalty.
Pre-Arranged Mortgage
A mortgage for a set maximum amount and interest rate that is arranged prior to the purchaser finding a house. Often arranged prior to home-shopping, this option can help the purchaser establish an affordable price range.
Prepayment Options
Allows the borrower to prepay a portion, or all of the principal balance, with or without penalty. These options are typically restricted to specific amounts and times.
Principal3The amount initially borrowed, under the mortgage.
Rate (Interest)DThe annual percentage amount charged in return for borrowing funds.
RealtorrA real estate professional who is a member of a local real estate board and the Canadian Real Estate Association.
Second Mortgage
A mortgage granted when there is already a mortgage registered against the property. If the borrower defaults and the property is sold, the second mortgage is paid after the first.
Security
Property (assets) offered as backing for a loan. In the case of mortgages, the property being purchased with the loan forms the security for the loan.
Survey
A document providing details of a property's boundaries, measurements and structures. It will also describe any easements, rights of-way, or encroachments made by either your property or by adjoining properties onto your property.
Title0The legal reference of ownership of a property.
Title Search
A detailed examination of the registered title documents to ensure there are no liens or other encumbrances (claims) on the property, and no question regarding the seller's statement of ownership.
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