Standard Charge

Definition

When you need a loan for a mortgage the lender or bank requires security that you will repay the loan. This comes as a charge registered with the province land registry office. It secures the mortgage to the land and gives the lender certain rights as to the term of the agreement.

A Standard Charge includes the specific details of the mortgage loan such as the amount, term and interest rate. These are included in the charge that is registered to the property. A standard charge only secures the amount of the mortgage.

With a standard charge mortgage, you will be able to transfer your mortgage to a new lender at the time of the loan renewal with being charged any legal fees. However, with a standard mortgage, you will not be able to withdraw any extra money out of your mortgage without being charged for legal fees, refinancing and penalties.

Standard Charge kept simple

A Standard Charge term means the specific details of a mortgage loan that includes all information such as the amount, term and interest rate is then registered with the provincial land registry department. This is to secure that you will repay the loan to the lender.

How does Standard Charge apply to you

If you purchase a home for $350,000 and you put $50,000 downpayment on the loan the amount owing on the mortgage is $300,000. 

The standard charge and the details of the mortgage are then registered with the provincial land registry to secure the loan for the lender.

When you are at the renewal phase of your mortgage you are then able to transfer your mortgage to a new lender without having to pay any legal fees. However, you are unable to withdraw or borrow more money on the mortgage without having to refinance and incur legal fees.

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