Rural and Acreage Mortgages in Alberta

Why acreage mortgages are different

Many lenders treat a house on land differently from a house in town. Things that commonly come up:

• Land size and value. Lenders may limit how much land counts toward the lending value, or treat larger parcels as agricultural. Appraisals focus on the home and a usable building site.
• Water and septic. Lenders often ask for a potable water test on a well and want to know the septic system's type and condition.
• Year-round access. Insured mortgages need the property to be suitable for full-time, year-round occupancy with year-round access.
• Outbuildings and income. Shops, barns and secondary dwellings may add little lending value, and land used for farming or business may need a different lending approach.
• Appraisals. Rural comparable sales can be scarce, so appraisals may take longer.

Dower Act consent in Alberta

Under Alberta's Dower Act, a married person who owns their homestead generally needs their spouse's written consent, with a separate acknowledgment, before mortgaging it. Outside a city, town or village, a homestead can include up to one quarter section of land. Your lawyer handles the forms, but plan for it, especially if only one spouse is on title.

Farmland and agricultural operations

Working farms, larger agricultural parcels and land purchases without a house are usually financed through agricultural lenders or commercial programs, not a standard residential mortgage. John can talk through whether your property fits a residential program, and point you in the right direction if it doesn't.