Open Mortgage

An Open Mortgage is a mortgage that allows for a borrower to pay off a portion or the entire balance of the mortgage at any time, without penatly. Open mortgages are flexible and fluid, however, the greatest drawback with an Open Mortgage is the fact that the interest rates offered with Open Mortgages generally exceed those of Closed Mortgages with the same terms. In addition, Open Mortgages rarely afford the option of moving one's mortgage from their existing residence to a new one if they were to move.

Open Mortgages are good for buyers who are looking at fliping properties, because they minimize the overall cost of borrowing, however, the increased interest costs of Open Mortgages make them a risky investment --since if the property does not immediatley sell, the additional cost will outweigh the projected savings.

For more information about open mortgages, contact one of the qualified mortgage professionals at Alberta Mortgage or Apply Online.