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.