A closed mortgage may not be paid off during the term without penalty. The interest rate is set for a pre-determined period, i.e., 1 - 10 years. At the end of the term, the mortgage rate is re-negotiated.

A mortgage loan up to a maximum of 80% of the purchase price is referred to as a conventional mortgage. Any mortgage in excess of 80% must be insured against default (See High Ratio Mortgage).

A mortgage where you have a down-payment of less than 20% with a minimum of 5% of the purchase price. This type of mortgage must be insured against default & an insurance premium will be added to the mortgage total.

Should be avoided wherever possible. The mortgage cannot be paid out even by paying a penalty.

The most flexible of all mortgages. Usually charged a higher interest rate but it may be paid off at any time without penalty.

The interest charged on a variable rate mortgage floats with the bank prime rate. After the experience of high interest rates in the early 80's, people were nervous of variable rate mortgages however they have become the product of choice for many mortgagors and recent studies have shown those on variable rate mortgages have paid the least amount of interest.