What Is A Closed Mortgage?
WHAT IS A CLOSED MORTGAGE?
A closed mortgage term means you agree to keep the loan for the agreed-upon term. (3-years, 5-years, etc)
Closed mortgages have lower interest rates than open mortgages. However, they do offer limited flexibility around the repayment of your loan. You cannot pay off a closed mortgage without a prepayment penalty.
The majority of mortgages in Canada are closed mortgages due to the lower interest rates.