Agreement to Lease:
A contract by which one party agrees to rent real estate to another party for a rental fee or other compensation.
The gradual retirement of a debt by means of partial payments of the principal and interest at regular intervals. This is basically the number of years it will take to pay off the entire amount of a mortgage. In Ontario, most mortgages are amortized over 25 years.
The attachment or incorporation of one parcel of land within an adjacent area, e.g., a city annexing a defined area from an abutting township.
A regular stream of payments payable at stated intervals for a fixed period of time.
The act or process of estimating value. In real estate this is an estimate of a property's market value. The process of appraising is complex due to many factors that affect the value of real estate. Appraisal is also used by lenders to determine the amount of your mortgage.
Lending institutions whose mortgages may qualify for insurance against default from CMHC (Canada Mortgage and Housing Corporation) or from a private mortgage insurance company such as GE Capital Mortgage Insurance Canada.
The value of a property set by the local municipality. The assessment is used to calculate the property owner's share of property tax.
A mortgage held on a property by a seller that can be taken over by the buyer. The buyer then assumes responsibility for making payments. An assumable mortgage can make a property more attractive to potential buyers.
For more terminology and jargon check:
Regardless of how certain you are that you will get mortgage, it is always good idea to get pre-approved from the mortgage lender of your choice. This will officially address any questions about your eligibility, rate, terms and it will enable you to better negotiate for the property of your choice.
Credit scoring model seeks to quantify how likely the consumers are to pay off their debt without being late. The more your credit file demonstrates that you pay your debt on time, the more desirable you become as a potential customer. The higher the client's score is, the less likely they are to default on their loan.
Familiarize yourself with the fundamentals of real estate before you invest in your first property.
Make sure your information is up to date. You have to know and be realistic about today's real estate market.
Location matters, so before you buy any real estate property, ensure that it's in a good location.
Regardless of how certain you are that you will get mortgage, it is always good idea to get pre-approved.
Keep in mind, the commission is always negotiable upfront, before you sign a contract.
If you are working with agent, make it clear that you want the agent, not his/her assistants, to represent you.
Before you buy any real estate property, have it inspected by a professional home inspector.
If you are buying property with a partner, have a proper partnership agreement to protect both of you.
Make sure you read your listing or buyer’s agreement carefully before signing it.
Don’t skip the final walk-through to make sure that everything is done properly, and that the items you agreed should stay are still there.
A deposit is part of your down payment and due upon acceptance of your offer.
Fee for appraisal prepared by appraiser is usually required by the lender or insurer prior to closing.
Legal fee and disbursements are required for closing the purchase and mortgage(s).
Premium for high ratio mortgage insurance (if applicable) + tax which must be paid on closing.
Land survey or title insurance are required to close the deal. Ask your lawyer for details.
Fire & extended coverage insurance is required for the outstanding balance of mortgage.
Ontario land transfer tax is due on closing and reflected in the "Statement of Adjustment".
Other extra costs like: prepaid expenses and fees, moving expenses, utility hook-up, decorating, etc.