Comments on: Mortage Term Glossary

By: Neil

Neil — Sat, 01 Nov 2008 13:33:52 +0000

Barabara -> We have prepayment policy built into our mortgages here as well. That’s what the open/closed referes to.

A Closed mortgage will typically allow you to prepay 15% of the original mortgage amount per calendar year.

An Open mortgage will allow you to prepay as much as you would like. You can even discharge the mortgage though an administration fee will usually apply.

By: Barbara Swafford

Barbara Swafford — Sat, 01 Nov 2008 07:14:35 +0000

Hi Neil – It sounds like you do a fabulous job. Your clients are lucky to have someone like you to “hold their hand”.

I notice you said you’re in Canada. Here we often have prepayment penalties thrown into a mortgage. Do you have that, too? Those could be a real nightmare for someone if they’re not aware of it.

By: Neil

Neil — Fri, 31 Oct 2008 23:39:10 +0000

Cave -> I aim to have everyone who leaves my office leave with a little bit more knowledge. I’ve dealt with too many customers who have confused Open vs Closed with Fixed vs Variable and that can be a dangerous set of terms to confuse.

Eric -> The housing bubble in the US has been a nightmare (I’m in Canada and we haven’t had our bubble burst, yet). However, housing prices should eventually rise back up. In the meantime remember that every payment gets you close to developing that equity in the home.

By: Eric Hamm

Eric Hamm — Fri, 31 Oct 2008 23:16:35 +0000

Thanks for sharing this useful info, Neil.

My wife and I bought our home when the housing bubble was still blowing up. So our house is worth a little less than we owe, but not too bad. The purchasing wasn’t a complete nightmare or anything, but we certainly found it overwhelming when it came to trying to understand all the ins and outs of buying a home.

Once again, great info, very helpful. Eric.

By: cave2626

cave2626 — Fri, 31 Oct 2008 12:34:30 +0000

Neil, I wish there were more people in the financial industry who were like you. When I got my first mortgage it was a nightmare. When it came time to move again and go through the mortgage process a second time, I ask so many more questions. And for the most part the bankers were good but it’s tough to ask questions if you don’t really know what to ask. I found that talking with as many people as possible really helped. As you’ve said, most people have mortgages. Learn from the shared experience. Having a list of mortgage terms would have been useful then and will be useful next time. Thanks.