Open Mortgage

Mortgage that has matured or is overdue, and the property is therefore open to Foreclosure at any time.

A Mortgage that has Matured or is overdue and is therefore open to Foreclosure at any time.
Example: Towns sells a property to Udall. Towns provides financing for the sale in the form of a 5-year, Interest-Only loan. At the end of 5 years, Udall does not pay the Principal and Towns allows the loan to become an open mortgage. This arrangement allows Udall to pay off the loan at any time or Towns to call the loan at any time.