Ontario Real Estate Licensing Exam Practice · Question
A buyer is considering a mortgage product that allows them to prepay a portion of their principal at any time without penalty. Which type of mortgage feature does this best describe?
An open mortgage offers flexibility, allowing borrowers to make extra payments or pay off the entire mortgage without penalty at any time. This differs from a c
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Question: A buyer is considering a mortgage product that allows them to prepay a portion of their principal at any time without penalty. Which type of mortgage feature does this best describe?
Answer options:
- Closed mortgage
- Convertible mortgage ✅ Open mortgage
- Subprime mortgage
Correct answer: Open mortgage
Explanation: An open mortgage offers flexibility, allowing borrowers to make extra payments or pay off the entire mortgage without penalty at any time. This differs from a closed mortgage, which typically imposes penalties for early prepayment beyond a certain allowance.
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- What is the primary purpose of registering a deed under the Registry Act in Ontario?
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- A seller accepts a conditional offer. Before the conditions are fulfilled, the seller receives a firm, higher
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