- Amortization Period: The number of years that it will take you to pay back your entire mortgage loan
- Appraised Value: An estimated value of a property that is completed by a certified appraiser for mortgage financing
- Assumability: When the buyer is allowed to take over (or assume) the seller's mortgage, which is already in place on the property
- Balanced Market: Where demand for property equals the supply of available property. Sellers usually accept reasonable offers and houses generally sell in sufficient time periods. Prices remain stable and there is usually a good number of homes to choose from
- Buyer's Market: There is a high number of homes to choose from and few buyers in comparison. Prices of homes tend to be lower and they remain available for sale longer. Buyers usually have more leverage in negotiating a purchase
- Closed Mortgage: A mortgage loan that has a locked-in payment schedule, which does not vary over the life of the closed term. A buyer who uses a closed mortgage will likely have to pay the lender a penalty if you fully repay the loan before the end of the closed term
- Conditions: Items that are usually put in place to protect a party's interests upon selling or buying the property and refer to things that must occur or be in place before the sale closes.
- Conventional Mortgage: A mortgage loan that is issued for up to 75% of the property's appraised value, or the property's purchase price, whichever is lower. The buyer must have 25% or more of the lower value as a down payment
- Conveyancing: The transfer of ownership of any property or real estate from one person to another
- Down Payment: This is the difference between the purchase price and the total amount of the mortgage loan, which represents the buyer's cash payment towards the purchase of a property
- Deposit: A deposit is usually given from the buyer to the seller as a token of the buyer's assurance and intention to buy the property involved. The deposit is applied against the purchase price of the home once the sale has closed. Len can assist you in proposing a certain and appropriate amount for the deposit.
- Equity: The difference between a property's market value for selling and the mortgage plus other debts taken against the property
- High-Ratio Mortgage: When a mortgage loan exceeds 75% of the home's appraised value. These types of loans are typically used by first time buyers and must be insured for payment
- Inclusions and Exclusions: These are specifications within the offer that detail the items to be included or excluded from the purchase of the property. Typical inclusions are appliances, window coverings, fixtures and decorative pieces.
- Interest Rate: A figure expressed as a percentage as the value that is charged by the lender for use of the lender's money
- Maturity Date: The end of the term of your mortgage loan. At this time, the buyer can pay off the entire mortgage loan balance or renew it for a longer term
- Mortgagee: The individual or financial institution that lends the money for the purpose of a mortgage on property
- Mortgage Insurance: Insurance purchased to protect the lender against loss from the borrower being unable to make payments on the mortgage loan
- Mortgage Life Insurance: Insurance purchased to protect the mortgagor from the mortgage loan debt if the mortgagee dies. If he/she dies, the mortgage loan is paid off by the insurance company
- Mortgagor: The person who borrows from a financial institution to finance a property or home purchase
- Open Mortgage: A type of mortgage loan where the borrower can make a partial or full payment of the principal amount at any time, without penalty
- Portability: An option available on a mortgage that enables the mortgagor to take their current mortgage loan with them to another property without penalty
- Possession or Closing Date: This is usually the date that the legal ownership of the property transfers from the seller to the buyer and, unless otherwise noted, when the funds for the purchase are concluded.
- Pre-Approved Mortgage: When a lender approves the potential mortgagor for a specified amount, based on how much money the lender is prepared to lend to the borrower. This allows buyers to shop for homes that they already know they can obtain financing for and not homes that are potentially too expensive, or out of the borrowers means to finance
- Prepayment Privileges: Allows the borrower to make voluntary payments on the mortgage loan, in addition to the regular, scheduled mortgage payments
- Property Purchase or Land Transfer Tax: A toll paid to the provincial and/or municipal government(s) for transferring property to the buyer from the seller
- Principal: The amount still owing to the lender or the amount borrowed from the lender, excluding interest. Interest is applied and payable based on the principal amount outstanding
- Purchase Price: This is the amount that the buyer is offering to pay for the property. The price is usually dependent on market conditions and may differ from the seller's current asking price.
- Refinancing: Re-negotiating the current terms of a mortgage loan or paying off the current mortgage loan and obtaining a new one
- Renewal: At the end of a mortgage term, the borrower re-negotiates the loan for a new term
- Second Mortgage: A type of additional financing on top of your existing mortgage. This second mortgage usually is applied at a higher rate of interest and is negotiated for a shorter term
- Seller's Market: More buyers are looking for homes than there are homes for sale. There is a smaller inventory of homes available for sale and many buyers looking to purchase. House prices generally increase and homes sell quickly
- Strata or Condominium Fee: A payment made by all owners of condominiums or townhouses within a particular complex that is allocated to pay expenses such as maintenance, repairs and management costs
- Term: The total length of time that the interest rate on a loan is fixed, which also indicates when the principal balance becomes due and is thus payable to the mortgagee
- Terms: An offer includes certain "terms", which specify the total price offered and how the financing will be arranged, such as if you will arrange your own with a financial institution or mortgage broker or if you wish to take over the seller's mortgage (assumability).
- Title: The legal ownership of a property/home
- Variable-rate Mortgage: A type of mortgage with fixed payments but fluctuating interest rates. The change in current interest rates doesn't alter the amount of the mortgage payment, but determines how much of each payment is applied against the principal amount and how much goes to pay interest to the lender
- Vender Take-Back Mortgage: A situation where the seller of a property provides all or part of the mortgage financing in order to sell their property