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Understanding Specialized Mortgages

Introduction

This course, divided into five sections, covers various financing considerations and alternatives for borrowers and properties of different types. Through discussion of types of repayment plans and non-conventional mortgage fund sources from private mortgages, mortgage professionals would be better equipped to advise on suitable products for their clients. Meanwhile, leasehold, construction, and commercial financing present particular issues based on the unique characteristics of the property and projects. An understanding of these specialized mortgages will allow mortgage professionals to serve a broader range of clients, or to specialize in specific sectors.

Course Outline


Section 1: Mortgage Loan Repayment Plans
  • Interest accruing loans
  • Interest only loans
  • Straight line principal reduction loans
  • Constant blended payment repayment plans
  • Payment frequency
  • Partial amortization and outstanding balances
  • Variable rate mortgages (VRMs)
  • Graduated payment mortgages (GPMs)
  • Sinking fund assisted mortgages
  • Reverse mortgages (Reverse Annuity Mortgages)
  • Participation mortgages
  • Addressing inflation directly in mortgages
Section 2: Private Mortgages
  • What is a private mortgage?
  • Private lenders
  • Who needs a private mortgage?
  • Underwriting the private mortgage
  • Funding the private mortgage
Section 3: Leasehold Finance  
  • Types of leases
  • Identification of leasehold interests
  • Occupation and ground (or building) leases
  • Analysis of ground leases
  • Ground leases on First Nations lands
  • Ground leaseholds and mortgage lenders
  • Subordination agreements
  • Sale-leaseback
  • Methods for appraisal of leasehold interests
Section 4: Development and Construction Financing
  • Overview of the land development process
  • Development financing
  • Construction financing
  • Structuring the construction loan
  • Alternative development financing arrangements
Section 5: Commercial Mortgage Underwriting
  • Application for commercial loans
  • Cash flow analysis (income, allowances, and expenses)
  • Lending constraints
  • Nature of covenants

Course Glossary

View the glossary of important terms for this course.