With all the different mortgage options out there, it is difficult to decide what route you should take.  On top of that, there are many mortgage terms that the average consumer may not fully understand.  Often overlooked is the repayment terms of the mortgage, meaning whether the mortgage is open or closed.

Open mortgages are a good option if you are planning on paying off your mortgage early either by selling or with cash.  With an open mortgage, you can make prepayments or even pay off your mortgage in full without any prepayment charges.  However, open mortgages often come with higher interest rates.   

Conversely, closed mortgages are a better option if you don’t have plans to pay off your mortgage soon.  Interest rates are typically lower for closed mortgages than open mortgages, but there are often charges for making prepayments over the specified limit.

It is important not to confuse open and closed mortgages with variable or fixed rate mortgages.  Open and closed mortgages refer to the repayment terms, whereas fixed and variable refer to the interest rate.

Before deciding on a mortgage, call a mortgage broker to discuss your financial goals and what mortgage terms would best help you accomplish those goals.

Call me today to discuss how I can help you accomplish your mortgage goals!