 |
Mortgage insurances |
Welcome to Mortgage insurances,
subject Open Mortgage (6 month to 1 year terms are most common):
Allows borrowers to repay all or part of the principal amount of their mortgage at any time without penalty. You usually have to pay a higher interest rate for this type of mortgage since it offers greater prepayment flexibility. This flexibility makes open mortgages ideal for homeowners who plan to sell in the near future or who want to wait for rates to drop before locking into a longer-term mortgage. Unfortunately, open mortgages expose homeowners to short-term interest rate fluctuations since the interest rate is reset at the end of each 6-month or one-year term. If rates are on an upswing, your mortgage payments will continue to climb. On the plus side, if the rates are going down, your payments will drop at each renewal. With this type of mortgage you are allowed to break the mortgage at any time and either switch lenders or lock into any other type of mortgage without penalty.
Back to Mortgage insurances