Mortgage Glossary

Open Mortgage

An open mortgage is a mortgage that is fully open and free of any penalty for early repayment. An open mortgage usually carries a higher interest rate, and gives the borrower flexibility to pay the mortgage in full or large sums without incurring unnecessary costs.

A home equity line of credit is usually considered an open mortgage. An open mortgage is usually recommended for borrowers looking for a very short term mortgage and plan to pay off the mortgage by refinancing or selling their property within a short time period, as they carry higher interest rates than a closed mortgage, however have the benefit of not having a penalty for early repayment.

Login to your account