Lines of Credit
A Line of credit is a one-time approved ongoing loan that allows you to borrow up to a pre-arranged limit by simply writing a cheque or using your debit card to make a purchase. You pay interest on the exact amount you borrow and only for the number of days you’ve used it, at rates usually substantially below retail credit cards.
Also known as personal loans, consumer loans are used to finance a variety of purchases and almost any major acquisition except the purchase of a home. A term loan usually has a maturity of one to five years with repayment in the form of regular payments of equal amounts.
A mortgage is a long time credit commitment. The purchase of a home is usually the largest purchase you will ever make in your life. Mortgages can range in term from six months to five years and have an amortization of up to twenty-five years.
Lenders will fund mortgages up to seventy-five percent of the appraised value of the home's property unless the mortgage is insured by a high ratio insurance company like Canadian Mortgage and Housing Corporation or Genworth.