Mortgage Glossary

Zoning refers to the geographic zone designations allotted by municipalities that impacts how a property can be used.

A Variable Rate Mortgage is a mortgage of any given term (usually 3 years or 5 years) where the interest rate moves in lock-step with your mortgage lender’s prime rate.

Title Insurance is a product that protects you from any fraud, errors or survey matters associated with the title of your property.

The title designates the ownership of a particular property.

The Office of the Superintendent of Financial Institutions Canada (OSFI) announced a number of new mortgage rules, also known as “stress test,” which came into effect on January 1, 2018. The stress test is the government’s way of preventing the worst-case scenario for the housing market by ensuring you can afford interest rate increases. Click here to learn more.

This is an asset that is used as collateral for the sake of a loan. In the case of your mortgage, your home is the asset used as security.

Reverse mortgages offer Canadians over the age of fifty-five the opportunity to tap into their existing home equity without having to sell and move. You may be able to borrow up to 55% of the current value of your home tax-free and the loan does not require any scheduled repayment.

To qualify for a mortgage, you’ll have to prove to your lender that you can afford the amount you’re asking for. Mortgage lenders or brokers will use your financial information to calculate your total monthly housing costs and total debt load to determine what you can afford.

The purchase price is the actual price you’ve agreed upon for the purchase of your new home. This price doesn’t include any closing fees, transfer taxes or interest costs.

The principal is the amount of money you’ve borrowed for your property. This doesn’t include any interest costs that might be required.