- Open-End Mortgage
A type of mortgage that allows the borrower to increase the amount of the mortgage at a later time. Open-end mortgages permit the borrower to go back to the lender and borrow more money if certain conditions have been met. There is usually a set dollar limit on the additional amount that can be borrowed.
For example, borrower A obtains a $200,000 mortgage to purchase a home. He gets an open-end mortgage that allows him to go back and borrow additional money over the life of the loan, as long as the total outstanding principal does not exceed a certain amount (such as 80% of the appraised value of the home). It is similar to how a HELOC allows homeowners to pull equity out of their homes.
Investment dictionary. Academic. 2012.
Look at other dictionaries:
open-end mortgage — A mortgage that allows the borrowing of additional sums, often on the condition that a stated ratio of collateral value to the debt be maintained. A mortgage that provides for future advances on the mortgage and which so increases the amount of… … Law dictionary
open–end mortgage — see mortgage Merriam Webster’s Dictionary of Law. Merriam Webster. 1996 … Law dictionary
Open-end mortgage — Mortgage against which additional debts may be issued. Related: closed end mortgage. The New York Times Financial Glossary … Financial and business terms
open-end mortgage — mortgage against which additional debts may be issued. Related: closed end mortgage. Bloomberg Financial Dictionary … Financial and business terms
open-end mortgage — Fin a mortgage in which prepayment is allowed. U.K. term open ended mortgage … The ultimate business dictionary
open-end mortgage — noun : a mortgage under which additional funds may be borrowed without making a new mortgage contrasted with closed mortgage * * * a mortgage agreement against which new sums of money may be borrowed under certain conditions … Useful english dictionary
open-end mortgage — a mortgage agreement against which new sums of money may be borrowed under certain conditions. * * * … Universalium
open–end — adj: organized to allow for contingencies: as a: permitting additional debt to be incurred under the original debt instrument subject to specified conditions see also open end mortgage at mortgage b: having fluctuating capitalization of shares… … Law dictionary
open-end — | ̷ ̷ ̷ ̷| ̷ ̷ adjective : organized, formulated, or constituted to contain possibilities for various contingencies whether unspecified, merely inferable, or definitely stated: as a. : permitting additional debt to be incurred under the original… … Useful english dictionary
open-end — adjective Date: 1917 organized to allow for contingencies: as a. permitting additional debt to be incurred under the original indenture subject to specified conditions < an open end mortgage > b. having a fluctuating capitalization of shares that … New Collegiate Dictionary