A mortgage is one of the biggest financial commitments most people ever make—but it doesn’t have to be complicated. Let’s break down what a mortgage is, how it works, and what you need to know to make confident decisions.

What Is a Mortgage?

A mortgage is a loan secured against real estate, usually a home. You borrow money from a lender to purchase or refinance a property, and in return, you agree to repay the loan with interest over a set period of time.

How Do Mortgage Payments Work?

Your monthly mortgage payment typically includes two main parts:

Over time, your payments reduce the balance of your loan (the principal). In the beginning, most of your payment goes toward interest, but that shifts as you pay down your mortgage.

What Is Amortization?

Amortization is the total length of time it will take to pay off your mortgage in full. In Canada, amortization periods are usually 25 to 30 years.

You don’t commit to one lender for that full time though—you’ll sign a mortgage term (usually 1–5 years), after which you can renew, refinance, or switch lenders.

What Is a Mortgage Term?

The term is how long you’re locked into your current mortgage agreement (rate, lender, and conditions).

At the end of your term, you can:

Types of Mortgage Rates

There are two main types:

Each has pros and cons, what’s right for you depends on your financial goals and risk tolerance.

What Lenders Look At

To approve a mortgage, lenders review:

What You’ll Need to Apply

You’ll need to provide documents like:

Why It Matters

Understanding your mortgage helps you make better decisions, avoid surprises, and feel more in control. Whether you’re buying your first home or refinancing to access equity, a clear grasp of the basics sets you up for success.

Need Help?

I’m here to walk you through every step—from approval to closing—and make sure the mortgage you choose fits your life.