Glossary
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| Bridge Financing |
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| A special short-term loan needed to cover (bridge) the gap in time between completing the purchase of one property and finalizing arrangements to pay for it. This is often the result of mismatched closing dates.
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| CMHC |
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| Canada Mortgage and Housing Corporation, a Crown Corporation which administers the National Housing Act. |
| Down Payment |
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| The amount of money (in the form of cash) put forward by the buyer toward the purchase price of a home.
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| Gross Income |
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| The scheduled income from the operation of the business or the management of the property, customarily stated on an annual basis. Also refers to the total personal income (from all sources) of an individual, before taxes and other deductions.
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| Guarantor |
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| A third party person without interest in the property who agrees to assume responsibility for a debt in the event of default by the mortgagor.
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| Maturity Date |
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| The last day of the term of the mortgage agreement. The mortgage must be paid in full or the agreement renewed by the maturity date.
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| Mortgage Insurance Premium |
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| A premium which is charged as a percentage of the mortgage. The mortgage insurance insures the lender against loss in case of default by the borrower. |
| Mortgage Life Insurance |
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| A form of reducing life insurance recommended for the borrower. In the event of death of the borrower or one of the co-borrowers, the insurance pays the balance owing on the mortgage. The intent is to protect survivors from losing their home. |
| Mortgagee |
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| The lender of the money. The holder of the mortgage.
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| Mortgagor |
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| The one who makes the payments. The owner of the property (the borrower).
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| National Housing Act Loan |
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| A mortgage backed (insured) to a certain maximum by CMHC or an approved private insurer. |
| P.I.T. |
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| Principal, interest and property taxes due on a mortgage. |
| Portable Mortgage |
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| Preliminary approval by the lender of the borrower's application for a mortgage to a certain maximum amount and rate. Usually conditional upon the property being purchased meeting the lender's criteria.
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| Principal |
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| The amount of money borrowed. Could be part of the repayment plan that lowers this original amount.
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| Second Mortgage |
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| A mortgage placed on real property which is already encumbered with one mortgage. Determination of first, second, third etc. mortgage is by priority of registration (time and date).
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| Variable Interest Mortgage |
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| A loan where the interest rate may vary during the term of the mortgage. The variance is usually tied to some specific factor such as prime bank rate or the guaranteed investment certificate rate for a designated lender.
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| Vendor Take Back Mortgage |
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| A mortgage which a vendor of real property takes from the purchaser usually as part payment of the purchase price for that property. A private first or second mortgage where the vendor lends to the purchaser.
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