Mr. and Mrs. Lee purchase a strata unit in Burnaby for $650,000 with a down payment of $200,000. They obtain a mortgage for the remaining $450,000 from a traditional lender. What type of mortgage do they have?

Question: Mr. and Mrs. Lee purchase a strata unit in Burnaby for $650,000 with a down payment of $200,000. They obtain a mortgage for the remaining $450,000 from a traditional lender. What type of mortgage do they have?

Answer options:

• A high-ratio mortgage requiring CMHC insurance.
• A vendor take-back mortgage. ✅ A conventional mortgage.
• An open mortgage due to the large down payment.

Correct answer: A conventional mortgage.

Explanation: A mortgage is considered conventional when the loan-to-value ratio is 80% or less, meaning the borrower has made a down payment of 20% or more of the property's purchase price, as is the case here (LTV = $450,000 / $650,000 = 69.23%).