A-C | D-G | H-N | O-Z

H

High Ratio Mortgage
A mortgage loan for in excess of 75% of the fair market value of a unit, as determined by the lender. This type of loan must be insured against payment default. Canada Mortgage and Housing Corporation (CMHC) is a federal agency that offers high-ratio mortgage loan insurance as do several private sector companies.

I

Insurance — Condominium Corporation
Every Condominium Corporation must place and maintain a “Master Policy” for a broad range of
perils specified in the Condominium Property Act and Regulation. Such a policy covers both the
Common Property and the Units (except, in some cases, for improvements made by Unit Owners). Additionally, the policy must insure the Condominium Corporation, its Board, Officers and employees against liability arising from their actions, errors or omissions in carrying out their functions and duties.

Insurance — Unit Owner
Unit Owner insurance protects against property loss, personal liability and disaster expenses. Such insurance typically offers all-risks coverage for an owner’s personal property in the event of loss from fire, theft and vandalism as well as improvement and betterment coverage for damage to upgrades made by the owner. Moreover, this coverage typically provides for the unit owner’s share of liability in any action against the Condominium Corporation as well as the unit owner’s share of costs arising from all-risks claims on the common property. In placing insurance, care should be taken to avoid duplicating coverage provided by the Condominium Corporation’s Master Policy and potential coverage disputes between insurers in the event of a claim.

Interest
The cost of borrowing money. Interest is usually paid to the lender in installments along with repayment of the principal loan amount.

Interest Adjustment Date (IAD)
A date from which interest on the mortgage amount advanced is calculated for your regular payments. This date is usually one month before regular mortgage payments are to begin.

Interior Floor Plan
A scaled down, two-dimensional overview of each level of a home, including the basement if applicable.

J

Joint Tenancy
Typically, spouses or life partners will hold Title to their condominium unit jointly. This means that each person owns an undivided half-interest in the unit. In the event of the death of one person, the other person automatically becomes the sole owner by the rights of survivorship.

L

Lending Value
The lesser of the appraised market value or the purchase price of a home.

Loan to Value Ratio
The ratio of the mortgage loan to the lending value of a property, expressed as a percentage. For example, the loan-to-value ratio for a mortgage of $90,000 on a home with a lending value of $100,000 would be 90%.

Lot Grade
The topographical profile of a lot after landscaping and in relation to the lot’s boundaries as well as geographic and physical features such as roads, sidewalks, storm sewer intakes and adjacent
property. Adherence to proper grades, as approved by municipal authorities, ensures that surface water drainage is away from buildings and towards storm sewer collection points.

Lot Plan/Grade Slip
A scaled down overview showing the location of a building or buildings on a lot in relation to the
borders of a property and easements on the property. The lot plan also shows “grade” elevations for any buildings and at the property lines. A municipality must ensure that the grades are correct and that the placement of any building on the lot plan conforms to bylaws governing minimum required “setbacks” from the property lines and from any easements running through the property before the lot plan can be approved. Once approved, the municipality will issue a ”Grade Slip” authorizing a Developer to contour the finished landscaping of a lot to conform to the approvedm grades on the lot plan.

M

Mandatory Clauses
The contractual arrangements between The Alberta New Home Warranty Program and a Purchaser for the various protection coverages offered by the Program through a Builder Member. Mandatory clauses are part of the Purchase Agreement.

Maturity Date
The last day of the term for a mortgage agreement. On this date, the mortgage must either be repaid in full or the loan agreement must be renewed for another term.

Mortgage — Unit
Like any home purchase, ownership of a condominium unit plus its share in the common
property is an estate in land. The Alberta Land Titles Office will issue a Title and register mortgage documents and other instruments such as Caveats or Liens against the Title of a condominium property or “Unit” just as it would for any non-condominium real estate property.

Mortgagor
The borrower who pledges to repay a mortgage loan and who pledges the mortgaged property as security for the loan.

Mediation
An informal, voluntary process in which The Alberta New Home Warranty Program acts as a facilitator to help the Purchaser or Homeowner and the Developer/Builder get together in the case of a dispute so that the issues can be identified, along with any misunderstandings or miscommunications, and so that both parties may reach agreement on a solution.

Mortgage
A mortgage is a legal security, registered on Title, for a loan on the property you own. As such, it is your agreement that you will repay the loan according to the terms and conditions of the loan. As a financial charge (encumbrance) registered on Title, it is also your pledge of the property as security for the loan in the event of default (non-payment).

Mortgagee
The lender providing a mortgage loan.

Mortgage Holdback (see also “Deficiency Holdback”)
An amount or amounts, if any, withheld by a mortgage lender from mortgage advances or at the time of the final mortgage disbursement to ensure construction is satisfactory or complete.

Mortgage Holder (see “Mortgagee”)

Mortgage Life Insurance
Insurance that guarantees full repayment of your mortgage in the event of your death. Typically, this insurance is available from or through your mortgage lender and the premiums are added to your regular mortgage payment amounts. Alternatively, mortgage life insurance is available from and through insurance brokers and agents.

Mortgage Loan Insurance
In the event you require a high-ratio mortgage (more than 75% of the lending value of the property), the mortgage lender will require mortgage loan insurance that pays the lender the full amount of the principal, interest and costs should you default on the loan. Mortgage loan insurance is available from CMHC, a federal agency, or from private insurers.

Mortgage Payment
A regularly scheduled payment which is blended to include principal and interest, commonly referred to

N

Net Worth
Your total financial worth, calculated by subtracting your total liabilities (mortgage, car loan, credit line debt etc.) from your total assets (value of home, car, savings, RSP, etc.)