Ontario Real Estate Licensing Exam Practice · Question
A mortgage states that it cannot be paid off in full before the end of the term, except under specific conditions outlined in the agreement, and typically incurs a significant prepayment penalty. What type of mortgage is this?
A closed mortgage typically restricts prepayment options before the end of the term and often comes with penalties for early payout, offering lower interest rat
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Question: A mortgage states that it cannot be paid off in full before the end of the term, except under specific conditions outlined in the agreement, and typically incurs a significant prepayment penalty. What type of mortgage is this?
Answer options: ✅ A closed mortgage
- An open mortgage
- A vendor take-back mortgage
- A conventional mortgage
Correct answer: A closed mortgage
Explanation: A closed mortgage typically restricts prepayment options before the end of the term and often comes with penalties for early payout, offering lower interest rates compared to open mortgages.
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- A buyer is considering a mortgage product that allows them to prepay a portion of their principal at any time
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- What is the primary purpose of registering a deed under the Registry Act in Ontario?
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