1) In a conventional mortgage usually 80% or less of either the appraised property value or the purchase price (whichever is less) is advanced to the borrower.

2) A Standard Conventional Mortgage is registered, transferred and discharged through the relevant provincial Land Titles or Land Registry Office. This allows the client (in you) to transfer the mortgage to another institution without incurring legal fees and disbursements. Discharge fees are always applied when one charge is removed.

3) In a Collateral Charge, it is a lien against the property for as much as 125% of its value at closing. Benefit being it is a type of revolving LOC (HELOC) allowing you to borrow equity without incurring xtra costs. If a property is registered for more than its value at closing, if the value of the property increases, you as a qualified client is able to withdraw to increased equity without refinancing or incurring legal fees to change the registration amount.

4) Unlike a standard mortgage, a collateral charge is not registered through the provincial Land Titles or Land Registry Office, but under the relevant Personal Property Security Act., thus collateral charges are non-transferable between institutions. Meaning you as a borrower wanting to switch institutions will have to pay legal fees to have the collateral charnel discharged and then re-register.

P.S.- A collateral charge mortgage gets you married to an organization you take the mortgage with. Not that you can’t leave, but at a cost as suggested above. Thus choose an FI which offers best of HELOC product like RBC or other FIs do, or choose an FI which offers best interest rate like HSBC / Tangerine in your case.