Mortgages and Financing

A mortgage is an interest in property provided by the borrower as security for a loan.

• The Borrower (mortgagor) receives funds

• The Lender (mortgagee) has an interest in the property until the loan is repaid.

Sources of Mortgage Funding

• Banks and Trust Companies

• Insurance and Finance Companies

• Credit Unions

• Mortgage Brokers

• Property Vendors

• Private Loan Companies

Types of Mortgages

• Conventional Mortgages - A mortgage loan issued fro up to 80% of the appraised value or purchase price, whichever is less.

• High Ratio Mortgage - A mortgage that is issued for more than 80% of the appraised value of the property. This kind of mortgage must be insured if arranged through a bank or trust company.

RRSP Home Buyer's Plan (HBP)

Buying your first home? Under the RRSP Home Buyer's Plan, you and your spouse may each be able to withdraw up to $25,000.00 tax free from each of your RRSP's and use it for the down payment. Provided that you meet the conditions for participating in the Home Buyer's Plan, there are no tax penalties due to a withdrawal from your RRSP, and you can take up to 15 years to pay back your RRSP in annual installments. Both you and your spouse must be first-time home buyers to qualify.

Your Real Estate Agent or Mortgage Broker can provide you with more information about the plan.