Homepage

A variable-rate mortgage has an interest rate that can change as the lender's prime rate changes. Variable rates are often offered at a discount or premium to prime, depending on market conditions and the lender.

Depending on the mortgage product, your regular payment may stay the same while the amount going toward principal and interest changes, or your payment may increase or decrease when rates change. Terms commonly range from 1 to 5 years.

A variable-rate mortgage may appeal to borrowers who are comfortable with interest rate fluctuations and want the flexibility of a rate that moves with the market.

An open mortgage offers greater flexibility, allowing you to make additional payments or pay off the mortgage in full without a traditional prepayment penalty during the open term.

This flexibility usually comes with a higher interest rate than a comparable closed mortgage. Open mortgages are often available with shorter terms and may be useful if you expect to sell your home, pay off your mortgage or make a large lump-sum payment in the near future.

A secured line of credit, often called a Home Equity Line of Credit (HELOC), allows you to borrow against the equity in your home. Once approved, you can access funds as needed, up to your approved credit limit.

Interest rates are usually variable and tied to the lender's prime rate. You typically pay interest on the amount you borrow, rather than the full available credit limit. A HELOC can provide flexibility for renovations, larger expenses or managing cash flow.

Depending on your financial situation and available home equity, you may be able to have a secured line of credit alongside your mortgage.