Mortgage Glossary Alberta: Every Term You Need to Know
Mortgages come with their own language - amortization, LTV, stress test, collateral charge, trigger rate. This is the most complete plain-English mortgage glossary in Alberta, including the Alberta-only terms the national sites never cover. Bookmark it. You will come back.
More than 100 terms, A to Z, each in plain language - with links to the full guides and calculators where a definition alone isn't enough. Entries marked Alberta are specific to how things work in this province.
A
A-Lender
A traditional, institutional lender - banks, credit unions, and monoline lenders - offering the best rates and terms with the strictest qualification: strong credit (typically 680+), verified income, and standard debt ratios. Most homebuyers get their mortgage through an A-lender.
Alternative Lender
Any lender operating outside standard A-lending rules - B-lenders, trust companies, credit union alternative programs, and private lenders. Used when income documentation, credit, or the property itself does not fit A-lender criteria. Higher rates, more flexibility, and often the smart bridge back to an A-lender later.
Amortization
The total time it takes to pay off your mortgage in full at regular payments - most commonly 25 years. Insured mortgages allow 30 years when at least one borrower is a first-time buyer or the home is newly built. Longer amortization means lower payments but more total interest. Not the same as the term. Run your own schedule here.
Appraisal
A professional assessment of a property's market value by a licensed appraiser, required by lenders to confirm the property supports the loan. Typically $300-$500 for a standard home, more for acreages and rural properties - where the appraisal rules themselves change. Acreage guide.
Appraised Value vs Purchase Price
Lenders lend against the LOWER of the appraised value or the purchase price. If you pay $520,000 and the appraisal lands at $500,000, the mortgage is calculated on $500,000 and the $20,000 difference comes out of your pocket. A live risk on unique and rural properties with few comparable sales.
Approval (Conditional vs Full)
A conditional approval means the lender will fund once specific conditions are met - usually appraisal, title review, and final document verification. A full approval means every condition is satisfied and the mortgage is ready to fund. Never waive a financing condition on a conditional approval alone.
Assignment (Assignment Sale)
Selling your pre-construction purchase agreement to a new buyer before the home is completed. The new buyer takes over the contract. Financing an assignment purchase has extra wrinkles - the lender may work from the original price, the assignment price, or the appraisal.
Assumable Mortgage
A mortgage the buyer can take over from the seller - same rate, same remaining term - subject to the lender approving the new borrower. Valuable when the existing rate is below market. More common on fixed-rate mortgages; always lender-approval required.
B
B-Lender
An alternative lender serving borrowers who don't quite meet A-lender standards - lower credit, non-traditional income, or higher debt ratios. Rates typically run one to three points above A-lender pricing. Often a stepping stone: fix what caused the decline, then refinance to an A-lender at renewal. Second mortgage and private lending guide.
Bank of Canada Overnight Rate
The policy interest rate set by the Bank of Canada eight times a year. It drives lender prime rates, which drive variable mortgage rates and HELOCs. It does NOT set fixed mortgage rates - those follow bond yields. Understanding that split explains most rate headlines. How rates actually work.
Beacon Score
An older industry name for your Equifax credit score, still used constantly by lenders and brokers ("what's the Beacon?"). Same 300-900 scale as any credit score. If a lender document says Beacon, it means your Equifax score.
Blend and Extend (Blended Rate)
Combining your existing rate with a current rate when you increase your mortgage mid-term, instead of breaking the mortgage and paying a penalty. The result is a "blended" rate on the new, larger balance, usually with a new full term. Can save thousands in penalties - and sometimes costs more than breaking. Run both numbers.
Bond Yields (5-Year Government of Canada)
The market interest rate on Government of Canada bonds. Fixed mortgage rates are priced off these yields plus a lender spread - which is why fixed rates can move even when the Bank of Canada does nothing. Yields move with inflation, government borrowing, and global events. The two-engines explanation.
Bridge Financing
A short-term loan covering the gap when you buy a new home before your existing home closes. The bridge covers the down payment on the new home and is repaid when the old home's sale completes. Typically 30-120 days, and it needs a FIRM sale on the existing home.
C
Canada Guaranty
One of Canada's three mortgage default insurers (with CMHC and Sagen). Insures high-ratio mortgages - under 20% down - so lenders can offer competitive rates on small-down-payment purchases.
Cash-Back Mortgage
A mortgage that advances a lump sum of cash at closing in exchange for a higher rate over the term. The cash cannot generally be used as the down payment at most lenders, and breaking the mortgage early usually means repaying the cash-back. Read the clawback clause before signing.
Chattel Mortgage
A loan secured against a movable asset - most commonly a manufactured or mobile home that is not permanently affixed to owned land. Different lenders, shorter amortizations, higher rates than a standard mortgage. Manufactured home financing guide.
Closed Mortgage
A mortgage that limits early payout without penalties. Most fixed-rate mortgages are closed. Prepayment privileges (usually 10-20% per year) still apply, but paying the full balance before maturity triggers a prepayment penalty. See Open Mortgage.
Closing Costs
The expenses beyond the purchase price: legal fees ($1,000-$2,000), title insurance ($200-$400), tax adjustments, inspection, appraisal. Alberta has no provincial land transfer tax - a genuine savings versus Ontario or BC - though land titles registration fees apply. Budget 1.5-2% of the purchase price. Closing costs FAQ.
CMHC (Canada Mortgage and Housing Corporation)
A federal Crown corporation and Canada's largest mortgage default insurer. CMHC insurance on high-ratio mortgages lets lenders offer lower rates on purchases with less than 20% down. Also runs specialized programs for newcomers, self-employed borrowers, and purchase-plus-improvements.
Collateral Charge
A way of registering your mortgage on title for MORE than the loan amount, making it easier to borrow again later without re-registering. The catch: switching lenders at renewal may require a full discharge and new registration with legal fees. Most big banks use collateral charges; most monolines don't. See Standard Charge.
Completion Date
The day the sale finalizes: the buyer takes legal ownership, mortgage funds advance, keys change hands. Also called the closing or possession date.
Conditional Offer
An offer to purchase that includes conditions which must be satisfied before the deal is firm - typically financing, inspection, and (for condos) document review. Waiving conditions before they are truly satisfied is how deposits get lost.
Condo Fees (and the 50% Rule)
Monthly fees paid to a condominium corporation for shared costs. For qualifying purposes, lenders count 50% of the condo fee in your debt ratios - so a $400 fee reduces your borrowing power like a $200 monthly debt. Property types explained.
Construction Draw Mortgage
A mortgage that releases funds in stages as a home is built - typically 4-5 draws at foundation, framing, mechanical, interior, and completion, each after a lender inspection. Construction mortgage guide.
Conventional Mortgage
A mortgage with a down payment of 20% or more, so default insurance is not required. Also called uninsured. Counterintuitively, conventional rates can run slightly HIGHER than insured rates, because the lender carries the full risk.
Convertible Mortgage
A short-term or variable mortgage that can be converted into a longer fixed term without penalty. Useful when you want to float briefly but keep an exit into a fixed rate. Conversion happens at the lender's then-current rates - not today's.
Co-signer / Guarantor
A person who strengthens the application with their income and credit (co-signer, usually on title) or guarantees payments without going on title (guarantor). Either way they are legally responsible for the full mortgage if the borrower defaults. Exiting later requires the remaining borrower to re-qualify alone.
Credit Score
A number from 300-900 representing your creditworthiness, built from payment history, utilization, history length, credit mix, and inquiries. Most A-lenders want 680+ for best pricing; below 600 usually means B-lender or private territory. Check yours free here.
Criminal Rate of Interest
The legal ceiling on what a lender can charge you. As of January 1, 2025 it dropped from an effective annual rate of 60% to 35% APR - and that 35% is all-in: it counts the interest plus the fees (lender fees, renewal fees, bonuses, administration charges), not just the posted rate. Because those fees get spread across the term, short one-year private mortgages feel it most - a modest rate stacked with heavy upfront fees can push the true APR far higher than it first looks. A homeowner's mortgage is a consumer loan, so the 35% cap protects you; higher limits apply only to large commercial loans. How this works on private & second mortgages.
D
Debt Consolidation
Rolling multiple high-interest debts - credit cards, car loans, lines of credit - into your mortgage at a far lower rate. Cuts monthly outflow and simplifies life; requires sufficient home equity. More people do this than you'd think, and it is a strategy, not a failure. Debt consolidation guide.
Default
Failing to make mortgage payments as agreed. Default can lead to foreclosure - which in Alberta is a court-supervised process (see Foreclosure). If you are heading toward trouble, the options are wider BEFORE a missed payment than after. Call early.
Deposit vs Down Payment
Two different things. The DEPOSIT is money submitted with your offer to show good faith - it is at risk if you walk away from a firm deal. The DOWN PAYMENT is the full amount you bring at closing; the deposit counts toward it. Alberta deposits commonly run $5,000-$25,000 depending on price and market.
Discharge
The legal removal of a mortgage from your title once paid off or when switching lenders. Lender discharge fees typically run $200-$400, plus registration. On a collateral charge, discharge is the step that makes switching lenders more expensive.
Dower Act Alberta
Alberta legislation protecting a married spouse's rights in the family home even when they are NOT on title. If a married person owns the home alone, the non-owning spouse must consent - with independent legal advice formalities - before the home can be sold or mortgaged. Missed dower consent can derail a closing. Your lawyer handles it; your broker flags it early.
Down Payment
The portion of the price you pay up front. Federal minimums: 5% on the first $500,000, 10% on the portion above that, up to the $1.5 million insured ceiling; at $1.5 million and above, 20% minimum. On acreages and high-value properties the REAL requirement is often set by lender rules, not the federal floor. Over $1 million guide and acreage guide.
E
Equity
Your home's market value minus what you owe on it. Worth $600,000, owing $350,000 - your equity is $250,000. It grows from paying down principal and from appreciation, and you can access it through a refinance, HELOC, or second mortgage. HELOC vs refinance guide.
Equity Takeout
Borrowing against your equity - via refinance, HELOC, or second mortgage - for renovations, consolidation, investment, or anything else. The right vehicle depends on how much, how long, and what your existing mortgage penalty looks like.
Estoppel Certificate (Condo Documents)
A statement from a condominium corporation confirming the unit's fee status, any arrears, and special assessments. Part of the condo document package lenders and buyers review before firming up. Special assessments discovered late are deal-breakers - review before waiving conditions.
F
FHSA (First Home Savings Account)
A registered account for first-time buyers combining the best of RRSP and TFSA: contributions are tax-deductible, and withdrawals for a qualifying home are tax-free. $8,000 annual contribution room, $40,000 lifetime. Stackable with the Home Buyers' Plan on the same purchase. Run the FHSA + RRSP numbers.
First-Time Home Buyer
Generally: you (and your spouse or partner) have not owned and occupied a home in the current year or the previous four calendar years. Unlocks the FHSA, the Home Buyers' Plan, 30-year insured amortization (with conditions), and GST relief programs on new homes. First-time buyer guide.
Fixed Rate
An interest rate locked for the entire term - predictable payments, protection from rate increases, priced off bond yields. The trade-off: breaking a fixed mortgage early can trigger the IRD penalty, which is where the real money hides. See Interest Rate Differential.
Flex Down / Borrowed Down Payment
Insurer programs allowing the down payment itself to be borrowed - from a line of credit or loan - rather than saved or gifted. The borrowed payment counts in your debt ratios, credit requirements are higher, and lender appetite varies. A niche tool, occasionally the right one.
Foreclosure Alberta
The court process a lender uses to recover a property after default. Alberta uses JUDICIAL foreclosure - a judge supervises every step, the process takes months to over a year, and borrowers keep meaningful rights throughout, including the right of redemption (see R). Different from the "power of sale" process used in Ontario.
G
GDS Ratio (Gross Debt Service)
The share of your gross income going to housing: mortgage payment, property taxes, heat, and half of any condo fees. Standard lender limit: 39%. One of the two ratios that decide your maximum mortgage. Affordability calculator.
Gift Letter
A signed letter from an immediate family member confirming down payment funds are a true gift, not a loan. Lenders require it whenever gifted money is involved, and may want to see the deposit land in your account. Gifts from non-family are a different, harder conversation.
Gross Income
Income before taxes and deductions - the number lenders use for debt ratios. For employees, it's straightforward salary. For the self-employed, WHICH number counts as income varies dramatically by lender - and that difference can be worth hundreds of thousands in approval. The self-employed guide explains the two readings.
Gross-Up (Income)
A lender practice of counting certain income types above their face value - most commonly non-taxable income (like some benefits or pensions), which many lenders increase by a set percentage since it isn't taxed. Which income gets grossed up, and by how much, is lender-specific and one of the quiet ways two lenders reach very different approvals on the same file.
GST on New Homes
New construction homes attract 5% GST (resale homes do not). Rebate programs can return part of it, with eligibility tied to price thresholds and use. On a new build, confirm whether the quoted price INCLUDES GST and rebate assignment - it changes your real cost and your mortgage math.
H
HELOC (Home Equity Line of Credit)
A revolving credit line secured by your home: draw, repay, redraw without reapplying. Capped at 65% of value standalone, or 80% combined with a mortgage. Variable rate tied to prime; interest-only minimum payments. Powerful and dangerous in equal measure. HELOC vs refinance guide.
High-Ratio Mortgage
A mortgage with less than 20% down, requiring default insurance from CMHC, Sagen, or Canada Guaranty. The premium (roughly 2.8-4% of the mortgage) is added to the balance. The upside people miss: insured mortgages often get the BEST rates on the market.
Holdback (Construction) Alberta
The 10% of construction payments that must be retained under Alberta's Prompt Payment and Construction Lien Act - the law that replaced the Builders' Lien Act in 2022. The holdback protects against liens from unpaid subcontractors; lien registration periods now run 60 days for most work (90 for concrete). Applies to construction draw mortgages. Construction guide.
Home Buyers' Plan (HBP)
The federal program letting first-time buyers withdraw up to $60,000 from RRSPs tax-free for a home purchase, repayable over 15 years. Stackable with the FHSA on the same purchase - the combination is the strongest down-payment toolkit first-time buyers have ever had. Run the combined numbers.
I
Interest Adjustment Date
When your closing date doesn't line up with your payment schedule, the lender collects interest for the stub period up front - the interest adjustment. A small, commonly forgotten closing cost that shows up on your statement of adjustments.
Insured Mortgage
A mortgage backed by default insurance (CMHC, Sagen, or Canada Guaranty), required under 20% down and only available below the $1.5 million purchase price ceiling. Because the lender's risk is covered, insured files generally receive the sharpest rates available.
Interest Rate Differential (IRD)
The penalty formula lenders use when you break a fixed-rate mortgage: roughly, the rate difference between your contract and what the lender could charge today for your remaining time, applied to your balance. Big-bank IRD penalties routinely run $5,000-$15,000+, and the calculation method varies enormously by lender. Choosing a lender with a fair penalty formula is worth more than a small rate difference - most people learn this the expensive way.
Investment Property
A property bought for rental income or appreciation rather than your residence. Minimum 20% down, slightly higher rates, and - critically - how much of the rental income counts toward qualifying varies dramatically by lender (see Rental Offset). Investment property guide.
J
Joint Tenancy vs Tenancy in Common
The two ways multiple owners hold title. JOINT TENANCY: owners hold equally with right of survivorship - when one dies, their share passes automatically to the others. TENANCY IN COMMON: owners hold defined shares (equal or not) that pass through their estates. The choice matters for couples, co-buying friends, and parents helping kids - decide it deliberately with your lawyer, not by default. Co-ownership FAQ.
L
Land Titles System (Torrens) Alberta
Alberta runs a government-guaranteed land registry - the Torrens system. The register IS the proof of ownership, backed by an assurance fund. It's why title searches here are clean and fast, and part of why Alberta closings work differently than in some provinces. Your mortgage is registered against title at the Alberta Land Titles Office.
Leasehold vs Freehold
FREEHOLD: you own the land - the normal case. LEASEHOLD: you own the home but lease the land under it (park communities, some resort and First Nations lands). Leasehold financing is a different world: far fewer lenders, and the years remaining on the lease can cap your amortization. If you're looking at leased land, talk to a broker BEFORE the offer - the lender list is short and specific.
Legal vs Non-Conforming Suite
A LEGAL secondary suite meets municipal zoning, permits and codes; a NON-CONFORMING suite exists but doesn't fully comply. The difference decides whether lenders count the suite's rental income toward your qualifying - and every lender draws that line differently. On a house-with-suite purchase, this question can decide the approval.
Lien
A legal claim against a property as security for a debt. Your mortgage is one. Unpaid taxes, contractors, and judgments can create others - and all liens must be dealt with before a sale or refinance closes.
Loan-to-Value Ratio (LTV)
The mortgage as a percentage of the property's value: $400,000 owing on a $500,000 home = 80% LTV. Key lines: 80% and under is conventional; above 80% requires insurance; 95% is the insured maximum; refinances cap at 80%. On larger properties, maximum LTV steps DOWN as value rises - see Sliding Scale.
Lump Sum Payment
An extra payment straight against principal, allowed penalty-free up to your prepayment privilege (usually 10-20% of the original amount per year). The single most powerful mortgage-shortening tool most people never use. Payoff strategy calculator.
M
Maturity Date
The end of your current term: renew, switch lenders, or pay out - penalty-free. The single best moment to shop your mortgage, and the moment most people sign whatever their lender mails them. Never sign the first renewal offer. Renewal guide.
Monoline Lender
A lender that does mortgages and nothing else - no chequing accounts, no credit cards. Monolines often beat big-bank pricing and offer friendlier penalty math, and they are available only through mortgage brokers, which is why many people have never heard of the lender holding their neighbour's mortgage.
Mortgage Broker
A licensed professional who shops your file across many lenders - 20+ in my case - and works for you, not the bank. One credit check, the whole market. For standard residential mortgages the lender pays the broker, so the service costs you nothing. Start with a pre-approval.
Mortgage Default Insurance
Insurance protecting the LENDER (not you) if you default - required under 20% down, premium of roughly 2.8-4% added to the mortgage. Not to be confused with mortgage protection insurance, which protects YOUR family (next entry).
Mortgage Protection Insurance (Life and Disability)
Optional coverage that pays your mortgage if you die or can't work - protection for your family rather than the bank. It can move with the mortgage, and you can typically take the first 30 days at no cost while deciding. Worth five unpressured minutes on any new mortgage, especially for self-employed and single-income households. I'm not a licensed insurance agent; coverage is provided through Manulife (1-866-677-4366) - I'll point you at the information and you decide.
Mortgage Term
How long your current rate and contract run - most commonly 5 years, available from 1 to 10. At the end you renew, switch, or pay out. The term is NOT the amortization: a 25-year amortization is typically five consecutive 5-year terms, each renegotiated.
A definition is not advice
This glossary tells you what the terms mean. It cannot tell you how they collide on YOUR file - where the ratios, the property, the income type and the lender rules meet. That takes fifteen minutes on the phone and costs nothing: 403-703-6847.
N
Net Worth
Total assets minus total liabilities. Lenders weigh it on self-employed files, large mortgages, and certain programs where assets can strengthen a file that income alone would not carry.
New Home Warranty Alberta
Alberta requires all new homes to carry approved warranty coverage - protection on materials, labour, and the building envelope for set periods. Lenders require the warranty registration for construction mortgage approval. New home warranty FAQ.
Newcomer Mortgage
Programs for people who immigrated to Canada within roughly the last five years: qualification with limited Canadian credit history, international credit reports accepted, down payments from 5%. Newcomer guide.
O
Offer to Purchase (Purchase Agreement)
The binding contract between buyer and seller: price, deposit, conditions, dates, and included items. Once conditions are waived it is FIRM - walking away risks the deposit and worse. Everything in your financing plan exists to make waiving conditions safe.
Open Mortgage
Payable in full anytime without penalty, in exchange for a higher rate. The right tool when a payout is imminent - a firm sale, an inheritance, a bridge period - and expensive for any other purpose.
OSFI (Office of the Superintendent of Financial Institutions)
Canada's federal financial regulator. OSFI sets the stress test (see S) and lending guidelines for federally regulated banks. Provincially regulated credit unions are not bound by OSFI rules - one reason a credit union sometimes says yes where a bank cannot.
P
PIT / PITH
Shorthand for the housing costs lenders count: Principal, Interest, Taxes, and Heat (plus half of condo fees where applicable). PITH is the numerator of your GDS ratio.
Payment Frequency (and Accelerated Payments)
Monthly, semi-monthly, biweekly, weekly - and the ACCELERATED versions of biweekly and weekly, which sneak in the equivalent of one extra monthly payment per year. Accelerated biweekly is the quiet workhorse: barely noticeable per paycheque, years off the mortgage. See the difference in dollars.
Portable Mortgage
A mortgage you can take with you - same rate, same term - when you move, avoiding the break penalty. Portability windows, top-up rules, and property requirements differ by lender, and a rock-bottom rate that cannot port can trap you. Ask before signing, not before moving.
Posted Rate vs Discounted Rate
The POSTED rate is the lender's official sticker price; almost nobody pays it. The DISCOUNTED rate is what you actually get. The trap: some lenders calculate IRD penalties FROM the posted rate, which inflates the penalty dramatically. Two lenders at the same discounted rate can carry wildly different penalty exposure.
Pre-Approval
A lender's preliminary commitment: amount, rate, and a rate hold, typically 90-120 days, based on a credit check and income review. It tells you your real budget before you shop and makes your offers credible. Not a guarantee - the property still has to pass. Pre-approval guide.
Pre-Qualification
The casual cousin of pre-approval: an estimate based on stated numbers, no credit check, no rate hold, no commitment. Fine as a first conversation; never write an offer on the strength of one.
Prepayment Penalty
The cost of breaking a mortgage before maturity. Variable mortgages: typically three months' interest. Fixed mortgages: the GREATER of three months' interest or the IRD - which at some lenders can be tens of thousands. The penalty clause is the most expensive fine print in the contract. Ask how it is calculated BEFORE you sign.
Prepayment Privileges
How much extra you may pay without penalty: commonly 10-20% of the original amount as annual lump sums, plus a 10-20% regular-payment increase. Real money if a bonus, inheritance, or business windfall arrives mid-term.
Prime Rate
The base lending rate banks set, moving in step with the Bank of Canada's policy rate. Variable mortgages and HELOCs are priced against it (prime minus or plus a margin). Prime changes - so rather than print a number here that goes stale, check today's prime on the Bank of Canada's daily digest, or text me at 403-703-6847 and I'll give you the real picture, including what it means for your file, in one message.
Principal
The amount you actually owe, separate from interest. Early in an amortization most of each payment is interest; the split shifts toward principal over time. Anything labelled "prepayment" goes 100% against principal - which is why lump sums punch above their weight.
Private Lender
An individual or investment group lending their own money, secured mainly by the property's equity rather than your credit or income. Higher rates, upfront fees, fast approvals, flexible criteria. Properly used, a short-term bridge with a planned exit - never a destination. Private lending guide.
Purchase Plus Improvements
One mortgage covering the purchase AND renovation costs, available from 5% down. Renovation funds are held back by the lawyer until the work is verified complete. The right tool for the good-bones house with the 1980s kitchen. Construction and renovation guide.
Q
Qualifying Rate
The rate used to TEST your application - not the rate you pay. Under the federal stress test, you must qualify at the greater of your contract rate plus 2% or the 5.25% floor (verified against OSFI's current published rule). It exists to prove you could still pay if rates rise. See Stress Test.
R
Rate Hold
A lender's guarantee to honour a quoted rate for a set window - commonly up to 120 days - while you shop. Rates rise, you keep the held rate; rates fall, you generally get the lower one. Free insurance that comes with a pre-approval.
Readvanceable Mortgage
A mortgage and HELOC under one roof: as you pay down the mortgage portion, the HELOC limit grows automatically, up to 80% LTV combined. Powerful for investors and disciplined borrowers; a treadmill for anyone else. HELOC vs refinance guide.
RECA (Real Estate Council of Alberta) Alberta
The regulator that licenses mortgage brokers in Alberta. Every legitimate broker holds a RECA licence, and you can verify anyone's status on RECA's public register. I have held mine continuously since 1999.
Refinance
Replacing your mortgage with a new, usually larger one - to access equity, consolidate debt, or restructure. Capped at 80% LTV. Mid-term refinances trigger the prepayment penalty; at maturity they are penalty-free, which is why timing the conversation early matters. Should-I-refinance calculator.
Renewal
Signing a new rate and term when your current term matures. Your lender mails an offer; the offer is rarely their best number; most people sign it anyway. Shopping your renewal - or having a broker do it - is the highest-return fifteen minutes in personal finance. Renewal guide.
Rental Offset / Rental Add-Back
The two families of methods lenders use to count rental income. An OFFSET subtracts a percentage of rent from the property's costs; an ADD-BACK adds a percentage to your income. Same suite, same rent - materially different qualifying results depending on the lender's method. One of the biggest lender-to-lender swings in the business. Investment property guide.
Reverse Mortgage
For homeowners 55+: access home equity as tax-free cash with no monthly payments; the loan repays when you sell, move out, or pass away. Available up to roughly 55% of home value depending on age and property. Done right, it is dignity and independence - done casually, it is expensive. Educate first. Reverse mortgage guide.
Right of Redemption Alberta
In Alberta's court-supervised foreclosure, the borrower's right to stop the process by bringing the mortgage current (or paying it out) within the court-set redemption period. It is one of several borrower protections built into Alberta's judicial process - and a reason acting early in financial trouble preserves real options.
RPR (Real Property Report) Alberta
A surveyor's legal drawing of the property showing boundaries and structures, normally required at closing in Alberta with a municipal compliance stamp. New RPRs run $500-$1,000 and are usually the seller's responsibility. Title insurance sometimes substitutes - your lawyer and lender decide.
S
Sagen
One of Canada's three mortgage default insurers (with CMHC and Canada Guaranty), running programs including New to Canada, Purchase Plus Improvements, and construction progress advances.
Second Mortgage
A loan registered behind your existing first mortgage. Higher rates than firsts, useful when breaking the first would cost more than the second's premium - or when the first lender won't advance more. Can be a HELOC, B-lender loan, or private mortgage. Second mortgage guide.
Separation Agreement
The legally binding document dividing property, debts, and support between separating spouses - and the key that unlocks the 95% spousal buyout program. Both sides need independent legal advice. Divorce and separation guide.
Sliding Scale
The lender practice of reducing the percentage financed as property value rises: a common structure lends 80% up to a threshold and a lower percentage above it - and both the threshold and the percentages differ by lender and by community. The reason "20% down" stops being the rule on higher-value Alberta properties. The full guide, with a calculator.
Spousal Buyout
One spouse keeps the family home and refinances to pay out the other's equity share - possible up to 95% LTV under insurer programs, treated as a purchase rather than a refinance. Requires a formal separation agreement. Divorce and separation guide.
Standard Charge
Mortgage registration for the exact loan amount, making a lender switch at renewal simple and cheap - typically an assignment rather than a discharge and re-registration. Most monoline lenders use standard charges. See Collateral Charge for the alternative.
Statement of Adjustments
The lawyer's closing ledger: purchase price, deposit credited, property tax adjustments, interest adjustment, fees - and the final cash-to-close number. Review it before closing day, not on it.
Stress Test (Minimum Qualifying Rate)
The federal requirement to qualify at a rate higher than you'll pay: the greater of your contract rate plus 2% or the 5.25% floor (verified against OSFI's published rule; OSFI reviews it at least annually). Applies to purchases and refinances at federally regulated lenders; renewal switches have exceptions, and provincially regulated lenders can differ. If the stress test is what's blocking you, that LAST sentence is where the conversation starts.
Switch / Transfer
Moving your mortgage to a new lender at renewal, usually at the new lender's expense for standard files. The five minutes of paperwork people avoid, priced in the thousands. A standard-charge mortgage switches easily; a collateral charge costs more to move - which is exactly why some lenders use them.
T
TDS Ratio (Total Debt Service)
The share of gross income going to ALL debt: housing (GDS) plus car loans, cards, lines, student loans, support payments. Standard limit: 44%. The second of the two ratios that set your maximum mortgage - and the one that consumer debt quietly destroys. See what consolidating frees up.
Title
Legal proof of ownership, held in Alberta's government-guaranteed Land Titles registry. Your mortgage registers against it as a charge; so can liens. Clean title is a closing condition on every deal.
Title Fraud
Criminals impersonating an owner to sell or mortgage a property they don't own. Rare, devastating, and the main modern argument for owner's title insurance - the lender's policy protects only the lender.
Title Insurance
Insurance against title defects - fraud, survey errors, unknown liens, compliance issues. Lenders almost always require their policy ($200-$400); the OWNER'S policy is optional, cheap at purchase, and the one that actually protects you. Sometimes also used in place of an RPR.
Trigger Rate and Trigger Point
On static-payment variable mortgages: the TRIGGER RATE is where your fixed payment no longer covers the interest; the TRIGGER POINT is where your balance exceeds the allowed limit and the lender requires action - higher payments, a lump sum, or conversion. If you hold a static-payment variable, know both numbers before the market makes you learn them.
U
Underwriting
The lender's detailed verification of everything - income, credit, property, source of funds - between application and final approval. Where files are won by preparation or lost by surprises. A broker's job is making sure nothing in your file surprises an underwriter.
Uninsured Mortgage
A mortgage without default insurance: 20%+ down payments, refinances, amortizations over 30 years, purchases at or above $1.5 million, and most rentals. Rates can run slightly higher than insured pricing since the lender carries full risk. Also called conventional.
Usury
Charging an unlawfully high rate of interest. In Canada there is a hard line for it - the criminal rate of interest, now 35% APR as of January 1, 2025 (down from an effective 60%), counting the fees and not just the posted rate. Cross that line and a loan goes from simply expensive to actually illegal. Usury is the whole reason I put the full, all-in cost of any private or second mortgage in front of you before you sign - so you always know which side of the line a deal sits on. See private & second mortgage costs.
V
Variable Rate
A rate that floats with lender prime. ADJUSTABLE variants change your payment when prime moves; STATIC variants hold the payment and shift the interest/principal split (see Trigger Rate). Variables typically carry the gentler three-months-interest break penalty - a structural advantage over fixed if life might move you mid-term. Fixed vs variable calculator.
Vendor Take-Back (VTB)
The seller lends part of the purchase price directly to the buyer, becoming a lender registered on title. More common in commercial and farm deals; occasionally the bridge that makes an unusual residential deal work.
W
Waiver of Conditions
The signed document that turns a conditional offer FIRM. Once waived, the deposit is at risk and you are legally committed - so financing conditions get waived only on a true approval, with the appraisal done, not on a verbal "should be fine." This single piece of paper is where more real estate grief begins than anywhere else.
Z
Zoning
Municipal rules governing what a property may be used for - and a quiet mortgage factor. Country residential vs agricultural decides your lender universe on rural files; legal suite zoning decides whether rental income counts; commercial-residential mixes need different lenders entirely. Acreage and zoning guide.
Missing a term?
If you ran into a mortgage term this page doesn't cover, text it to me at 403-703-6847 - you'll get the plain-English answer, and the glossary gets its next entry. This page grows the same way my business does: one real question at a time.
Still Have Questions?
The glossary covers the words. Your situation is a sentence. Fifteen minutes on the phone and you'll know how these terms actually apply to YOUR file - free, no obligation, plain English.
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About this glossary
Written and maintained by Shawn Selanders, RECA-licensed mortgage broker with Mortgage Architects, serving Calgary, Okotoks, High River, Diamond Valley, Foothills County and Southern Alberta since 1999. Definitions are reviewed against current sources, including the federal stress-test rule (checked against OSFI's published minimum qualifying rate) and Alberta's Prompt Payment and Construction Lien Act (which replaced the Builders' Lien Act in 2022). Rules, programs and figures change; anything time-sensitive is confirmed for your file before it is relied on.
This glossary is for information only and is not financial or legal advice. O.A.C. E.&O.E.