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The amortization period is the total number of years you will need to completely pay off your mortgage. The most common amortization period is 25 years. This is also the longest period allowed if your downpayment is less than 20% and your loan needs to be insured by a mortgage insurer like CMHC.
It's often advantageous to choose a shorter amortization period, because by paying off your mortgage more quickly you’ll save on interest.
To see how choosing a different amortization period affects the total amount you pay, use our calculator.
The mortgage term is the period during which your mortgage contract and the interest rate it specifies are in effect. For example, the amortization period for your mortgage might be 25 years, while the term might be three years. At the end of the three years, you have to renew your mortgage for another term. This is an opportunity for you to renegotiate your interest rate and conditions.
The downpayment is the initial amount you pay when you first purchase your home. The mortgage loan covers the rest of the purchase price.
The minimum downpayment is:
Did you know that you can use your RRSPs to make a downpayment? Learn more about the Home Buyers’ Plan (HBP).
A fixed rate remains the same for the duration of the mortgage term. This means that your payments will stay the same too.
With a variable mortgage rate, the interest rate and payment amount can go up or down depending on market fluctuations.
When you take out a mortgage loan you can choose between a fixed rate, a variable rate or a combination of the two.
A home equity line of credit comes with a variable rate.
The made-to-measure mortgage has a variable rate for the line of credit portion, and for the loan portion you can choose between a fixed rate, a variable rate or a combination of the two.
View our current mortgage rates.
By opting for a capped variable rate when you take out your mortgage, you can protect yourself against rate increases. The rate you pay will never exceed the capped rate. For example, if you choose to cap the rate at 5%, you can be sure that your rate will never be higher than this.
What is a mortgage?
A mortgage loan, or mortgage, is a legal agreement in which the house you buy is used as a security for the repayment of the funds you borrow. You must repay the loan amount plus interest.
Mortgage financing allows you to borrow money to purchase a property. You repay the loan in instalments, which include interest.
Are you a first-time buyer? Here are six things to do before you buy.
Need a little help? Find an advisor.
What is a first mortgage?
A first mortgage is one where the mortgage lender’s claim over the secured property (in this case, the house) has priority over the borrower’s other creditors. Some lenders may agree to a second mortgage, or even to lending without security over the property. To take advantage of National Bank’s rates, your loan must be secured by a first mortgage.
If a couple divorces or separates, what happens to their mortgage?
There are a few options:
*Subject to approval by National Bank.
What will happen to my mortgage if I die or become critically ill or disabled?
If you can no longer pay your mortgage, your co-borrower or your family will have to take over the payments. If they cannot afford to pay, they will be forced to sell the house.
This is why it’s important to protect yourself and your loved ones by taking out mortgage loan insurance. The insurance covers your insured payments in the event of disability, critical illness or death, depending on the coverage you choose.
What is CMHC and Genworth Financial Canada?
If your downpayment is less than 20% of the price of your home, you’ll need to purchase mortgage loan insurance. This insurance protects the Bank in the event that you default on your loan. The insurance is provided by one of these recognized mortgage insurers:
What is mortgage security?
When you borrow money to purchase a home, you agree to use your home as collateral for the loan. This agreement is known as a “mortgage” (or “hypothec” in Quebec). If you default on your mortgage loan, the lender can take legal action to gain possession of your home or sell it.
The charge is registered at the land registry office. Each province has its own rules regarding the different types of mortgages and how they are registered.
Mortgage loan or line of credit—which one is right for me?
A mortgage loan lets you borrow the money you need to buy your home, which is then used as collateral for the loan. You repay the loan in instalments, which include interest.
The All‑In‑One is a home equity line of credit. You can use it to purchase your home and then access your repaid principal to finance other projects without having to apply for another loan.
Not sure which is right for you? If you’re having trouble choosing between the two, there’s another option: our made-to-measure mortgage combines a loan portion and a line of credit portion. Speak with your mortgage advisor for more information.
What term should I choose for my fixed-rate mortgage loan?
It all depends on what your plans are and how much risk you are willing to accept. Think carefully, because once you sign your rate will be fixed for the duration of the term.
If you’re planning to remain in your home for many years, and you don’t want to renegotiate your rate, a longer term may suit your needs best. A longer term generally means a higher rate but lower risk, because you’re protected from potential interest rate hikes.
If you’re planning on selling your property, or you want the opportunity to renegotiate the rate and loan conditions, a shorter term is a better option for you. A higher tolerance for risk is required in this case: while you may save money if interest rates fall, remember that rates may also go up.
If you’re still unsure, ask your mortgage advisor for help choosing the best option for you.
What’s the difference between a conventional loan and an insured loan?
A conventional loan is a mortgage with an initial downpayment of at least 20%.
If the downpayment is less than 20%, an insured loan is required. This means that the loan must be insured by one of the recognized mortgage loan insurers, Genworth Financial Canada or the Canada Mortgage and Housing Corporation (CMHC).
How does the All‑In‑One line of credit work?
The All‑In‑One is a home equity line of credit. You can use it to purchase your home and then access your repaid principal to finance other projects without having to apply for another loan. Up to 65% of the value of the property can be in the form of a line of credit. You must provide a downpayment of at least 20% of the value of the property, and the rest of the financing, if applicable, must be in the form of a mortgage loan.
With this line of credit you can integrate your bank accounts ($6 per month per account) and save even more by consolidating your other loans with the same interest rate.
As you pay off your loan, the repaid principal becomes automatically available for other projects. You can access your funds at an ABM via your online bank with your debit card and more.
How can I get financing for a property that needs renovations?
You have three options:
What about self-employed workers?
If you’re self-employed or a small-business owner, you may not be able to meet the standard proof of income requirements. If you’ve been in business for at least two years and can provide evidence of sound financial and credit management, you can finance or refinance your home with our mortgage for the self‑employed.
Should I choose an open or closed fixed-rate mortgage loan?
This table compares the features of open and closed mortgage loans.
|What does it mean?||
You can pay off your mortgage more quickly without penalty.
There is normally a prepayment charge if you make extra payments before the end of the term. Accelerated payments can be made without penalty under certain conditions.
|A good option if:||
You are planning to sell the property or make a large payment, for example if you expect to receive an inheritance
You are planning to keep the property until the end of the term.
How much can I borrow to buy a home?
Before you start browsing the real estate listings, you’re going to need to work out how much you can borrow for your mortgage. In just a few clicks, our calculator can help you get an idea of the amount you can afford.
Don’t forget to check out our 6 mortgage calculators, which let you try out different scenarios to help choose the best options for you.
My downpayment is less than 20% of the value of the house I want to buy. What should I do?
If your downpayment is between 5% and 20% of the purchase price, your bank must take out mortgage loan insurance with either Genworth Financial Canada or the Canada Mortgage and Housing Corporation (CMHC), and you will have to pay a mortgage loan insurance premium in addition to your loan payments.
Did you know that you can use your RRSPs to make a downpayment? Learn more about the Home Buyers’ Plan (HBP).
Am I eligible for the Home Buyers’ Plan (HBP)?
To take advantage of the HBP, you must:
Don't have an RRSP? An RRSP loan or line of credit can help you take advantage of the HBP.
You can withdraw up to $25,000 per borrower tax-free, and you have 15 years to pay it back, interest-free. You’re basically lending yourself the money!
How can an RRSP loan or line of credit help me qualify for the HBP?
What are the steps in the mortgage application process?
There are four main steps in the mortgage application process: preparing for the meeting with your mortgage advisor; gathering documents; submitting the application itself; and signing the official documents upon purchase.
To learn more about the application process, see Applying for a mortgage.
What documents do I need?
What are the eligibility conditions?
During your first meeting, your mortgage advisor will ask you about your employment situation, your downpayment, your credit rating, and so on.
Are you a self-employed worker or business owner who is unable to provide standard proof of income documents? Our mortgage for the self-employed could be just what you’re looking for.
Do you have a poor credit rating or no credit history? Find out what it means to be a co‑borrower.
What is the difference between pre-approval and pre-qualification?
When you’re looking to buy a home, your mortgage advisor will make a general assessment of your borrowing capacity based on your income. This is called pre‑qualification.
Pre-approval, on the other hand, establishes your borrowing capacity more precisely, based on a number of factors including your credit score. The amount and the interest rate that National Bank offers you are usually guaranteed for 90 days. Pre‑approval is free, and there is no obligation to take out a loan afterwards.
Are you ready to get started? Get pre‑approved online in a few simple steps.
Can I make my downpayment online?
Absolutely. You can deposit your downpayment directly into your notary’s account using your online bank. It’s completely secure and as easy as paying a bill.
Simply ask your notary for a coupon for voucher downpayment with a unique reference number. Then, add Assyst Paiement from the list of suppliers to your online bank, along with the number indicated on the voucher. The notary will receive the payment in 72 hours or less.
My mortgage term is coming to an end. How do I renew it?
When it comes time to renew your mortgage, call us at 1‑877‑281‑0144 and leave a message including your loan number. A member of our mortgage renewal team will be pleased to call you back. They’re available Monday to Friday from 9:00 a.m. to 8:30 p.m. and Saturday from 10:00 a.m. to 4:00 p.m. (Eastern Time).
A renewal is an agreement on the conditions for a new term (duration, interest rate, payment frequency, etc.) once the current term is up.
You don't need to wait until the end of your term to renew your mortgage. By renewing early, you may be able to lock in an attractive rate. Call us now at 1‑877‑281‑0144 to talk about it.
Has your term expired? Contact your advisor as soon as possible, or call us on the number above.
What is mortgage refinancing?
Mortgage refinancing lets you borrow against the equity in your home. Refinancing allows you to borrow up to 80% of the estimated value of your property, minus the balance of your existing mortgage.
This can be an attractive option, because it provides a new source of credit to help finance your projects.
Good to know: If the value of your home has gone up over time, your home equity will also have increased.
How do I transfer my mortgage?
If you want to switch banks, sometimes you can transfer your existing mortgage instead of creating a new mortgage. In this case, the debts secured by the original mortgage must be repaid to the first lender. For help with your individual situation, don’t hesitate to contact your mortgage advisor.
Can I skip or delay a payment if my finances are stretched?
Can I change my payments?
You’ll have to wait until the end of your term to change the payment conditions.
But with an All‑In‑One line of credit, you’re free to decide how much to repay each month. Only interest and insurance, if applicable, must be paid monthly.
You can access this feature by signing in to your online bank.
Can I make a payment on principal?
To help you pay off your mortgage faster, you’re allowed to pay off up to 10% of the original principal once per calendar year. It’s up to you whether you make your payment on principal in one or several payments. You can do it by signing in to your online bank.
How can I avoid prepayment charges?
Start by reading your mortgage contract carefully before you sign, and if you have any questions, don’t hesitate to ask your mortgage advisor. Here are some strategies to help you avoid charges:
To learn more about optimizing your payments, read our advice on accelerated mortgage repayment.
I’m selling my home. What happens to my mortgage?
You can either transfer or break your mortgage. If you choose to break your contract and you have a closed mortgage, you may have to pay a prepayment charge. There may also be a charge if you transfer your mortgage to another lender before the end of your term.
With an open mortgage, you can make a partial or full prepayment with no penalties.
How do I view my mortgage transactions online?
To view your transaction statements online, sign-in to the old version of your online bank.
For more information, read the My online bank FAQ.
The transaction statements for your mortgage loan or home equity line of credit are normally sent by mail. Only the balance as of the last payment appears in your online bank.
What is the difference between a collateral and conventional mortgage?
There are two types of mortgages: conventional and collateral. National Bank provides collateral mortgages.
|Collateral mortgage||Conventional mortgage7|
|Secured debt with option to borrow additional funds||
|Option to transfer ("subrogation" in Quebec)
|Discharging the mortgage
What amount is registered for each mortgage type?
The maximum amount secured by the mortgage and the maximum interest rate are registered. The mortgage can be registered for an amount greater than the amount borrowed to secure future borrowing needs. For example, if your home costs $400,000 but you only need a loan for $320,000, the mortgage can be registered for up to $400,000.
The lender and borrower sign a credit agreement, separate from the mortgage, setting out the credit terms. The applicable interest rate, the amount borrowed and the credit terms are set out in the various credit agreements signed between the borrower and the lender.
Unlike a collateral mortgage, this type of mortgage is registered with credit terms. The registered amount is generally the amount being borrowed. For example, if your home costs $400,000 but you only need a loan for $320,000, the mortgage will be registered for $320,000.
What are secured debts and the additional funds option
This type of mortgage can be used to secure your current and future borrowing needs. You will be able to obtain additional loans later on up to the registered amount of the mortgage without having to grant a new mortgage every time. You won't have to pay the legal fees involved in creating and registering a new mortgage.
You can obtain additional funds to finance projects other than the purchase of the property. However, these funds are not granted automatically. The borrower must first requalify based on current credit standards and obtain the lender's approval.11
Traditionally, this type of mortgage is only granted to secure the repayment of a mortgage loan used to purchase a property.
You will be required to take out a new mortgage loan in order to borrow more money. You will need to pay the legal fees involved in creating and registering a new mortgage, unless your lender agrees to assume these costs. You must first qualify based on credit standards in effect.
Is there an option to transfer the mortgage to another lender ("subrogation" in Quebec)?
If you want to switch lenders, you may be able to transfer the mortgage rather than creating a new one. If the new lender doesn’t accept the request to transfer your existing collateral mortgage, you will have to pay legal fees to discharge your existing mortgage and register a new mortgage with the new lender.12
Any debts secured by the original mortgage must generally be repaid to the first lender.
This is the type of mortgage provided by National Bank.
If you want to switch lenders13, you can usually transfer your existing mortgage rather than registering a new one. Only the loan balance can be transferred. You will not be able to borrow additional funds under this mortgage. You will need to pay legal fees and possibly administration fees.
If the mortgage is not transferred to the new lender, you will need to pay fees to discharge your existing mortgage and register a new one.
What is involved in discharging a mortgage?
Discharging a mortgage means recording a mortgage discharge with the registry to release the Bank’s collateral hold on your home.
Generally, you will pay the cost to register the discharge and possibly a discharge fee to your lender.
To discharge a collateral mortgage, you must inform the lender and repay all the secured debt.
A conventional mortgage can only be discharged once the loan has been repaid in full. The mortgage is discharged at the borrower's request or automatically, depending on the lender and province.
TM All-In-One is a trademark of National Bank of Canada.
1. Subject to change without notice
2. Offer valid from January 17, 2011, to April 31, 2018. Limit of one cashback per All‑In‑One. The cashback will be credited to the client's All‑In‑One account at National Bank or will be granted in the form of a bank draft. If the loan is repaid in full, refinanced or renegotiated before expiry, a portion of the cashback prorated to the effective duration of the loan must be repaid. Employees of National Bank and its subsidiaries and entities are not eligible for this offer. National Bank reserves the right to end this offer at any time without notice. This offer cannot be combined with any other offer, promotion or advantage. All details and conditions are available in branches.
3. Subject to credit approval by National Bank.
4. Subject to not exceeding the maximum line of credit amount available, i.e., 65% of the value of the property.
5. Subject to credit approval by National Bank. Speak with your accountant, tax specialist or financial planner to see if this is the right strategy for you.
6. Certain restrictions apply. Please consult your loan contract.
7. The conventional charge mortgage is sometimes called a "residential mortgage" by some lenders. The “conventional charge mortgage” sometimes refers to a mortgage that is not insured by a mortgage insurer. The lender must purchase mortgage insurance when the financed amount is greater than 80% (or less, depending on the type of financing) of the mortgaged property’s value.
8. Up to the registered mortgage amount.
9. National Bank generally requires that the mortgage amount be 100% of the property value or the purchase price, whichever is less.
10. Administrative fees may also apply.
11. The request for additional funds could be denied if the borrower’s financial situation has changed, for example due to the loss of a job. The request may also be denied if the value of the property is insufficient to secure the additional funds.
12. The new lender may bear certain fees.
13. Subject to consent of the original lender in certain provinces.