Frequently asked questions

Unlike most institutions in Canada, we do not use the prime rate for our loans. We use CORRA Swaps.

The prime rate from the Bank of Canada is not an actual rate. Each bank publishes its own prime rate, which is a reflection of its own cost of capital, and is partly informed by the overnight rate set by the Bank of Canada.

The prime rate the Bank of Canada publishes is simply the mode of the published prime rates of the 6 largest banks.

CORRA Swaps, by comparison, are informed by the market and reflect interest rate expectations over the term of each swap rate.

Our 3-year product uses the 2.5 year swap rate, our 4-year product uses the 3.5 year swap rate, and our 5-year product uses the 4-year swap rate. The shorter term for the swaps reflects the expected duration of each of our loan products.

To view the CORRA swap rates yourself, you can visit https://www.chathamfinancial.com/technology/canadian-market-rates#view.

As there are no monthly payments with Fraction's product, it does indeed compound. Interest is charged each day at the daily rate, which is calculated from our posted annual rate.

We will include the daily rate in the final loan documents, but if you'd like to calculate it yourself, you can visit Fraction's rate conversion calculator.

The Fraction Mortgage helps homeowners to access the value locked in their homes with no monthly payments. 

They can use the cash for anything, from paying off credit-card debt to starting a business to buying a second home.

Learn more here, in our Fraction Basics modules.

Fraction offers no monthly payments and no payment penalties. Unlike reverse mortgages, we have a fixed-length term and do not have any age restrictions.

See how Fraction stacks up against the rest by visiting our blog for more financial product comparisons

Currently, Fraction lends in British Columbia, Alberta and Ontario.

Following a third-party appraisal of your home and a check of all your information, you may or may not be approved for a Fraction Mortgage.

Based on your application and the appraised value of your home, Fraction will determine how much cash you qualify for. Upon a deeper review, we will provide you with documentation outlining your funding amount and corresponding terms and conditions. Once you sign the final documents, we send you your money. 

Learn more here, in our Fraction Basics modules.

Yes, if you have 60% down on a home, you can work with Fraction to purchase the home with no monthly payments.

Absolutely. If you want to contact the team and ask any further questions about your circumstances, you may contact us at [email protected].

Be sure to include the province you’re inquiring about so we can better assist you.

Often homeowners seek ways to unlock equity in their homes for large expenditures or diversifying income – examples include funding home renovations, consolidating or paying off debt, launching a business, or purchasing a secondary residence. 

While in need of solutions, many homeowners aren’t interested in taking on more debt.

Fraction allows them to access the built-up equity in their homes with no monthly payments and an interest rate tied to their local market's value.

Anyone who owns a home and has enough equity built up can work with us. We have no age restrictions. 

Since there are so many factors that contribute to partnering with Fraction, each property is evaluated independently. Working with Fraction starts with getting a free estimate. With our estimate tool you can see how much tax-free cash you qualify for, with no impact to your credit score.

From there, after a hard pull credit check (which may impact your credit score) and official appraisal of your home, we’ll send you an agreement for your review. Here are some of the things we screen for before we lend:

• The single-family dwelling is located in a province or state in which we’re currently operational
• A 660 credit score
• A minimum of {{min_equity}} equity in your home

There is no catch. Fraction was built to offer homeowners everywhere a more flexible and fairer option for accessing money.

Fraction is a great option for those who aren’t best served by other options in the market. We allow people to take money out and diversify it, buy an investment property or second home, help a child with a down payment, or invest in a new business venture are the main reasons why we exist. The use cases are vast, and each individual's choice to use Fraction is different and nuanced. 

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You decide. Fraction will receive payment when you sell the home or choose to pay back Fraction. At the end of the 5 years, if you qualify, you can refinance with Fraction, otherwise you will have to refinance with another mortgage lender in order to pay back Fraction.

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Fraction makes money from our interest rate and our origination fees. Fraction offers this financing because millions of homeowners want to be able to take cash out of their home without linking it to monthly cash outflows or having to sell. 

It gives people financial freedom and another way to live their life to the fullest. Fraction may not work for everyone. For those that aren’t best served by other options in the market, the ability to take money out and diversify it, buy an investment property or second home, help a child with a down payment, or invest in a new business venture are the main reasons why we exist.

First lien. If you have any existing mortgages, the proceeds of the Fraction mortgage would go towards paying those out.

It depends. If you have an existing mortgage, you must have enough built up equity in your home to qualify for Fraction. We do require that you pay off your existing mortgage to work with us (you can use Fraction to pay off your existing mortgage).

Wondering if you qualify? Get started with an estimate here →

We've built the Fraction Mortgage with no monthly payments and penalties, no hidden fees, and removed all of the confusing financial jargon to help you find the right financial solution to meet your needs.

We keep things simple and fair for homeowners everywhere. Fraction's terms are clear and simple, and we will walk you through the whole process to make sure you understand everything before you sign.

Plus, Fraction has raised more than USD$250 million from international investors in Canada, the US, and Europe. Our world-class investors share our vision to change how homeownership works.