A mortgage is a loan taken out to purchase property. It is one of the most common borrowing instruments in Canada, and there are many different mortgage products available.
The most basic type of mortgage is the fixed-rate mortgage. With this type of mortgage, the interest rate will remain the same throughout the term of the loan. This will make budgeting and planning easier, as the payments will never change.
The variable-rate mortgage is another popular option in Canada. With this type of mortgage, the interest rate can fluctuate depending on market conditions. This could mean that payments could be lower at times and higher at other times.
In addition to the fixed-rate and variable-rate mortgages, Canadians can also choose from a variety of mortgage products, such as the adjustable-rate mortgage. With this type of loan, the interest rate can change periodically. This could be beneficial if interest rates drop, as the payments could become lower.
Another option is the open mortgage. With this type of loan, the borrower has the flexibility to make payments at any time, without penalty. This could be a good option for those who want to pay off their mortgage faster.
Finally, Canadians can also choose from combination mortgages, which allow them to switch between fixed- and variable-rate mortgages during the term of the loan. This could be beneficial if interest rates drop, as the borrower could switch to a lower rate.
No matter what type of mortgage product Canadians choose, they should be sure to understand the terms and conditions of the loan before signing. It is important to shop around and compare rates and fees to ensure that the mortgage product is the best fit for them.