Costs and fees on a second mortgage
The rate is one line on a long statement. This page lists every line you may be asked to pay, who charges it and what to ask.
The lines on the statement
Amounts vary by lender, province, home and loan, so this page lists no typical figures. Ask each professional and lender for exact dollar amounts in writing.
| Cost | Who charges it | What it pays for | What to ask |
|---|---|---|---|
| Interest | The lender | The use of the money, month by month | The rate, whether it is fixed or variable, and the payment in dollars |
| Lender fee | The lender | Setting up and funding the loan | The fee in dollars, and whether it comes out of the amount you receive |
| Broker fee | The brokerage | Finding the lender and handling the file | Whether there is a fee, who pays it, and that it is disclosed to you in writing before you commit |
| Appraisal | An appraiser | A professional opinion of the home value | Who orders it, who pays, and whether you pay if you do not go ahead |
| Title search and title insurance | Your lawyer or a title insurer | Checking who owns the home and what is registered against it | Whether you need title insurance, and what it covers |
| Legal fees | Your lawyer | Reviewing and registering the new mortgage | The lawyer's total, and what it includes |
| Registration fee | The land registry | Registering the new charge on title | The registration amount, and who pays it |
| Discharge and exit costs | The lender and your lawyer | Removing the charge when you repay, plus any early repayment charge | The early repayment charge and the discharge fee, in dollars |
| Renewal or extension fee | The lender | Extending the loan if you cannot repay on time | The fee, the new term and the new rate |
The Financial Consumer Agency of Canada lists the costs of borrowing against your home as appraisal, title search, title insurance and legal fees, and notes that the rate on a second mortgage is usually higher than on a first mortgage because the lender takes more risk.
How to ask for the total
Ask for the cost of borrowing in writing, in dollars, for the full term, including every fee on the table above and what happens if you need to extend. Add it up yourself, and add what you would still owe at the end. The calculator does that arithmetic from a quote. For a worked case, see the guides.
See what your options could be
Four short questions. A licensed mortgage professional in your province may call you if you agree. You are not committing to anything by asking.