Chapter 2 Key Terms & Definitions Flashcards
1st mortgage
The first mortgage registered on title of a property, based on the date of registration
2nd mortgage
A mortgage registered on title next, after the first mortgage, based on the date registered. If the first mortgage has been discharged, this mortgage would be a first mortgage, not a second.
3rd mortgage
A mortgage registered on title after a 2nd mortgage, based on the date of registration
Assignment of mortgage
The transference of a mortgage from one lender to another
Charge/Mortgage
The document that indicates that there is a debt registered against the title of a property
Chattel
Personal property, movable property and and other property not deemed to be fixtures
Collateral mortgage
A promissory note secured by a lien on the property for the total amount registered, which may differ from the total amount advanced
Conventional mortgage
A mortgage not exceeding 80% loan to value
Discharge of Charge/Mortgage
The document that indicates that a debt has been removed from the title of a property
Down payment
An amount of a purchaser’s money provided to the vendor from his or her own resources (not included in a mortgage loan). Under certain programs this amount may be borrowed.
Equity take-out (ETO)
The removal of equity by refinancing of the property
Interest Rate
The rate at which interest, which is a fee paid to the lender for borrowing money, is calculated
Mortgage
The providing of real property to a lender as security in exchange for a debt
Mortgagee
The lender
Mortgagor
The borrower
Payment
A periodic amount, in dollars, required to be made in relation to a mortgage contract. A payment may be interest only or a blend of interest and principal.
Personal property
Everything one owns that is not real property. This includes chattels and other goods. Personal property is not typically fixed in its location and normally has a shorter useful life expectancy than real property.
Real property
Land and everything affixed to it. It is in a fixed location and is permanent, remaining, to one extent or another, long after the current owners have relinquished their rights to it.
Self-insured lender
A lender that does not use default insurance, but that charges a lender’s fee and pools the money in a reserve fund to help offset the risks associated with lending high ratio mortgages and mortgages without the protection of default insurance. The amount of this fee is typically similar to what a borrower would pay for default insurance.
Standard Charge Terms
The terms and conditions of the mortgage contract, including the remedies available to the lender upon default by the borrower.
Term
A period of time in which the mortgage contract is in force. After this period of time the mortgage must be fully repaid or renegotiated.
Title
A term that refers to the ownership of a property. If something is registered “on title” it means that it is officially registered against the ownership of the property through the Land Titles Office, where property ownership is recorded
