WHAT IS A COLLATERAL CHARGE MORTGAGE?

When your mortgage is registered with the Land Title Office as a Collateral Charge or a Standard Charge.

A Collateral Charge mortgage registers your mortgage for more than your actual mortgage balance.  This allows the borrower to increase their mortgage amount or access a line of credit at a later date without another set of legal fees.

For example, say John Smith owes $350,000 on his $750,000 home.  He registers his mortgage as a collateral charge for $500,000.

In 2 years, John can increase his mortgage size or add a line of credit with his existing lender with no costs. (Legal fees to register a new amount at the Land Title Office)