To complete this little guide, here is a glossary about more useful words you must understand in order to make a good deal when you will buy a house.
Closed Home Mortgage Loan: Type of loan that requires a strict repayment timetable. A penalty is charged if you repay your home loan in full before its period’s end.
Conventional Home Mortgage Loan: A loan of 75% or less of the appraised value or purchase price of the house (the lower of these two amounts).
High ratio mortgage: Mortgage that exceeds 75% of the estimated value of the house. These loans require insurance.
Condominium: The owner has title to a unit and a part of the elements it shares with other owners such as elevators or surrounding land.
Assessment: Determine the value of the house by an expert in order to have a good idea of what you buy. This assessment should not be confused with the building inspection.
Transferability: Allows the buyer to take over the seller’s mortgage when he buys the house.
Down Payment: The sum that the buyer pays cash to buy the house. Differential amount between purchase price and the amount of mortgage.
Amortization Period: Total number of years it takes to repay your home.
Equity: Differential between the value of your home and the amount of the home mortgage loan you need.
Due date: End of the lending period for your mortgage loan. At this time, you can either repay it totality or renew it.
Mortgagee: The person or financial institution as bank that borrows you the home mortgage loan.
