- A closed mortgage is a restrictive type of mortgage that cannot be prepaid, renegotiated, or refinanced without paying breakage costs or a penalty to the lender.
- With a closed mortgage, the interest rate is more attractive than an open mortgage because you are limited by how much extra you can pay towards your mortgage each year.
- Whenever possible, be sure to select the “original mortgage balance pre-payment option” as this will enable you to pay off more in a year than the “current balance” alternative.