Rate types
Fixed rate
Your interest rate and payments stay the same for the whole term. Easy to budget. Nothing changes.
Variable rate
Your rate moves up or down with the Bank of Canada. Your payment usually stays the same, but how much goes to interest vs principal shifts.
Adjustable rate
Your rate moves with the Bank of Canada, and so does your payment. Payments can rise or fall.
Buying basics
Deposit
Money you put down with your offer to show the seller you're serious. It counts toward your down payment.
Down payment
The total upfront amount you pay for the home, usually a percentage of the purchase price. Bigger down payment = smaller mortgage.
Terms & options
Term
The length of your current mortgage deal, usually 1 to 5 years. At the end you renew or switch lenders.
Closed term
Locked in for the length of the term. Breaking it early means a penalty, but rates are lower than open terms.
Open term
Pay it off any time without a penalty. The trade-off is a higher interest rate.
Payout penalty
A fee charged if you break or pay off your mortgage early. On fixed mortgages this is usually the greater of 3 months' interest or the Interest Rate Differential (IRD).
Bridge loan
Short-term financing that covers your down payment when your new home closes before your old one sells.
Amortization
The total time it would take to pay off your entire mortgage at the contract payment (e.g. 25 or 30 years).
Porting
Taking your current mortgage (same rate and terms) with you to a new home when you move. Avoids breaking the term.
Pre-payment privilege
Lets you pay extra, beyond your regular payments, without penalty, usually 15–20% of the original loan amount each year. Those extra payments go straight to principal, reducing interest and shortening your amortization.
Every mortgage is different. The right structure depends on your timeline, your income, and what you're trying to achieve. That's the conversation worth having.