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It is a mortgage where a borrower can take an additional loan on the same primary mortgage up to a specified limit. <\/b><\/p>
It is a mortgage loan that allows the borrower to borrow additional funds at a later date under the same first mortgage. <\/b><\/p>
It lets the borrower take a portion of the mortgage loan amount for which he is approved to cover the cost to purchase the house; by borrowing only a portion of the loan, the borrower pays a lower rate of interest because he is only obliged to pay interest on the outstanding balance and not the total amount that he qualified for.<\/b><\/p>\n
For example, suppose you took a mortgage of $250,000 to buy a house, but are eligible for an open-end mortgage of $ 350,000. <\/b><\/p>
Until you borrow anything in addition to the original loan amount, you only have to pay the principal and interest of the $ 250,000 you first received.<\/b><\/p>\n
After a few years, you borrow $ 50,000; you will begin paying interest on this amount along with your existing principal balance as well as any other amount that you borrow in the future.<\/b><\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t