A | B | C | D | E | F | G | H | I | J | L | M | N | O | P | R | S | T | U | V | W
Package Loan [back to top]
The combination of two types of loan. For example, a construction loan and permanent financing (the borrower benefits by only having to negotiate with a single lender and only having to pay a single set of closing costs)
Partial Discharge [back to top]
A discharge of a definite portion of the mortgage lands given after the mortgagor has prepaid a specific portion of the mortgage debt.
Participation Loan [back to top]
An agreement whereby two or more lenders share in advancing a portion of a loan made by the originating or lead bank; the terms in this type of agreement establish a method of apportionment and interest rates.
Partnership [back to top]
An arrangement whereby individuals join together where, in the beginning a general partner who has the experience and the limited partners have the money, in the end the general partner has the money and the limited partners gain the experience.
Percent Paid Off [back to top]
The percent of principal that is paid off at any given time under an amortization schedule.
Percentage Rent Plus Minimum [back to top]
A percentage rental which must be paid in addition to the minimum; this is a minimum rent that is not credited against percentage rent payable.
Percentage Rental Against Minimum [back to top]
A rental paid on a percentage lease where rent paid by a tenant varies according to volume of business. For example, a percentage of gross receipts, sales or revenue are paid to the extent where they exceeds a minimum rental.
Permanent Financing [back to top]
A long-term mortgage usually intended to finance both land and improvements after completion of construction and is used to pay down a construction loan.
Personal Covenant [back to top]
A legally-binding promise made by a borrower to repay the mortgage including the interest. The "personal" aspect refers to the lender's right to personally sue the borrower for breach of promise or default of the mortgage.
Personal Liability [back to top]
A person liable on a debt to the full extent of their entire assets as opposed to limited liability where a maximum or a ceiling is fixed on the amount of assets that can be drawn upon to satisfy a debt.
With personal liability, joint and several liability establishes the liability of each individual borrower for the total debt, joint liability binds all the borrowers together in one action, and several liability fixes the liability of each borrower to the extent of their share of the debt.
Personal Property [back to top]
All property except land and the improvements completed for the land.
Portable Mortgage [back to top]
A mortgage which allows one to transfer the amount and terms over to a new property without cost or penalty. The mortgage must be registered on title of the new property, therefore it is not identical in all respects. While most mortgages have a portability feature, one may require additional money when transferring the mortgage to the new property.
Postponement Clause [back to top]
A mortgage may contain a postponement clause where the mortgagee permits the borrower to renew or release an existing first mortgage that falls due prior to the maturity date of the current mortgage.
Power of Sale [back to top]
The right of a mortgagee to force sale of the property without judicial proceedings should default occur.
Pre-Qualification [back to top]
An interview with a client, generally prior to the writing of an offer to purchase a property, in order to determine the applicant's qualifications for obtaining a mortgage.
Prepayment Clause [back to top]
A clause inserted in a mortgage that gives the mortgagor the privilege of paying off some or all of the mortgage debt in advance of the maturity date.
Prepayment Penalty [back to top]
If one's mortgage is not fully open, they may be charged a penalty to pay off all or part of the mortgage before the end of the fixed term. Normally, the prepayment penalty is the greater of three months' interest or the interest rate differential (IRD) on the amount to be prepaid. Note that with CMHC (insured) mortgages, plus a few of the major lenders, the maximum penalty is set at 3 months interest after the mortgage has been in effect for three years regardless of the number of times it has been renewed.
Prepayment Privilege(s) [back to top]
The right to periodically repay an amount that is greater than the scheduled principal payment. This may be limited to a single annual payment on the anniversary date of no more than 10% of the original principal.
Prime Rate [back to top]
The rate charged by banks to their most credit-worthy borrowers; this rate is also referred to as the rate of interest paid on government bonds.
Principal [back to top]
The amount borrowed for a mortgage.
Principal, Interest, Taxes, Heating (PITH) [back to top]
The principal, interest, taxes, heating and half of any condominium fees, if applicable. These expenses are known as the "shelter expenses". The "shelter expenses" are a basic component of the ratios used to determine whether one qualifies or not for a mortgage.
Pro Forma Statement [back to top]
A financial statement of the gross income, operating costs, net operating costs and net operating income for a specified financial period (e.g. one year) using specified assumptions.
Progress Advances [back to top]
Loan advances made on a property under construction where a lender makes advances on the basis of the retention at all times of an amount of the loan which, in their opinion, will be sufficient to complete the building should the construction fail to be completed.
Projected Income [back to top]
Estimated income from a property.
Promissory Note [back to top]
A written document that acknowledges a debt and promising payment.
Property [back to top]
Refers to the rights which an individual enjoys by virtue of their ownership.
Purchase-Money Mortgage [back to top]
A mortgage loan taken back by the property vendor in lieu of purchase funds in order to help finance the purchaser.