Mortgage Glossary

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Lump Sum Payments

Most lending institutions will allow you to make large lump sum payments against your mortgage principal. These amounts are principal only and reduce the balance owing.

The amounts vary by institution, some are up to 20% of the original mortgage amount. So if you borrowed $120,000 originally, they will allow you to pay up to $24,000. This is usually allowed on only one occasion per year.

Each institution has different rules on the amount, and when, you can pay down on your mortgage. Some lenders combine the totals from 'additional mortgage payments' with 'lump sum payments'.
Please discuss the current policies of the different institutions with a BC Mortgages broker.

 

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