With a fixed-rate mortgage, your interest rate stays the same for the entire term, making it easier to plan and budget with predictable monthly payments. A variable-rate mortgage changes with the prime interest rate. When interest rates decrease, a larger portion of your payment is applied toward your principal. When interest rates rise, a larger portion of the payment goes toward interest.

Please note: Haventree Bank currently only offers fixed-rate mortgage options.

A longer-term mortgage typically has a term of 3 years or more. A shorter-term mortgage usually ranges from 1 to 2 years.

These two mortgage types offer different levels of flexibility when it comes to prepayments:

1. Open mortgage: Offers the freedom to make partial or full prepayments at any time without penalties.

2. Closed mortgage: Offers limited prepayment options during the term. Full prepayment is allowed, but a prepayment charge applies:

The greater of:

• 3 months’ interest at the rate of the mortgage calculated on the mortgage amount being prepaid; or

• The interest rate differential (IRD), based on the difference between your rate and the posted rate closest to your remaining term, multiplied by the amount being prepaid, and multiplied by the time remaining on your term.

You can make one prepayment each year without charge. For details, see our prepayment options section.

When you get a mortgage, your lender registers a legal claim (called a charge) on your home. There are two main types: standard (conventional) charge and collateral charge

Standard charge (also called a conventional mortgage charge):

• A standard charge is registered only for the amount of your mortgage. For example, if you borrow $500,000, the charge is registered for $500,000.

• If you wish to borrow more, you will need to refinance, discharging the original mortgage and registering a new one.

• Once your mortgage is fully repaid, it is removed from your property title.

This type of charge makes switching lenders in the future simpler.

Please note: Haventree Bank only offers standard mortgage charges.

Collateral charge:

• A collateral charge is registered for an amount greater than your actual mortgage and may cover more than one loan from the same lender.

• It’s re-advanceable, meaning you could borrow more in the future without needing to refinance.

• Switching to another lender may require refinancing.

• Even if you have paid off your mortgage, the collateral charge will only be discharged once all the loans secured by the charge have been repaid. This can involve additional legal steps.

You can make lump sum payments toward your mortgage principal before the maturity date. If these payments are made outside the prepayment privileges outlined in your mortgage agreement, prepayment charges may apply. Be sure to review your mortgage terms to understand when and how much you can prepay without penalty.

Each year, at the anniversary date* of your mortgage advance, you can take advantage of the following prepayment options:

• Increase the principal and interest portion of your original payment by up to 20%, and/or

• Make a lump sum payment of up to 20% of your original mortgage amount (minimum $500) toward your outstanding balance. This second option is not cumulative. Any unused portion of the 20% doesn’t carry over the following year.

* Your mortgage anniversary date can be found in your mortgage documents.

You may be charged a prepayment penalty if you:

• Partially prepay amounts higher than allowed by your prepayment privileged amount outlined in the mortgage documents.

• Refinance your mortgage before your maturity date.

• Transfer your closed mortgage to another lender before the maturity date.

• Pay off your mortgage in full before the end of your term.

*For fixed-rate mortgages, prepayment charges are based on the interest rate differential (IRD) or three months’ interest, whichever is greater.

Prepayment charges depend on the timing of your payment, the amount, and changes in interest rates. To estimate how these factors affect your fees, use our prepayment calculator.

In addition to any prepayment penalty, an administration fee may apply for discharging your mortgage.