Understanding the terminology

Glossary of terms

Whether you’re buying a home or simply refinancing, here is some information to help you gain more understanding of mortgages.

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Complete definitions

Terms & terminology

The financial world has it’s own language that can seem daunting to those not familiar with it, so Mid Island Mortgage has put together a complete lexicon of terms and terminology to help you.

For complete definitions, mouse over the terms below.

First Time Buyer

  • Pre-approval – Sit down with a Mortgage Professional before you start looking for a home.  It’s important to know what you can afford, and what the buying process entails
  • Down Payment – The minimum required down payment is 5% on the first $500,000 and 10% on the remaining balance.  If you have 20% or more you will avoid paying additional insurance costs to CMHC, Sagen or Canada Guaranty
  • Closing Costs – On top of your down payment, you’ll need money for items like Property Transfer Tax, Legal Fees, Title Insurance and an Appraisal
  • House Insurance – Before a lender will fund your mortgage, you need to have house insurance in place

Mortgage Renewals

  • Approximately 4-6 months before the maturity date of your mortgage, your lender will contact you about your renewal.  They’ll discuss what options are available for you at renewal
  • Past clients of Mid Island Mortgage & Savings will be contacted 4-6 months prior to renewal to start looking at options as well.  New to Mid Island Mortgage?  Call us to go over your renewal options
  • Renewal time can be a great time to look at refinance options.  Consider your five year goals and any upcoming expenses.  Are there any renovations, vacations or investment opportunities coming up? 

Equity Mortgages

  • Have a strong net worth and a lot of equity in your property? An Equity Mortgage might be a fit for you.
  • There are equity programs that offer lower income requirements than traditional mortgage lending
  • This is gaining popularity for helping children with buying homes or early inheritances

Mobile Homes

  • Buying a mobile home is very different than buying a more traditional property
  • The length of time you can amortize a mobile home loan is based upon the remaining economic life of the mobile home.  This is determined by an appraiser
  • For the most part all Mobile Homes in parks require CMHC (Canadian Mortgage & Housing Corporation) insurance, regardless of the down payment amount
  • For those who don’t qualify through major lenders, private mortgages are available
  • Our Brokers are well versed in Mobile Home lending and are happy to discuss your options

Second Home Purchase

  • Programs are available to purchase a second home for a family member to reside in with a minimum down payment – 5% on the first $500,000 and 10% on the balance
  • Suitable for those with a child attending university in a new town. Buy a condo or home rather than paying rent or dorm fees.  
  • Ageing family members at risk either financially or with health concerns can be assisted with options that can be discussed with your Mortgage Broker.

Rental Home Purchase

  • Minimum required down payment is 20%
  • If you own your principal residence we can help you refinance to get equity out for a down payment 
  • The rental income from rental property can be included in your income to help you qualify for a mortgage