To help you calculate your prepayment charges, it might be handy to have any of the following available:
- your mortgage commitment;
- your mortgage renewal agreement; or
- your annual mortgage statement
Estimating three months’ interest:
| | | Example
| | Your estimate
|
| Step 1 | The amount you want to prepay | $250,000 (A) | |
| Step 2 | Your current interest rate | 0.0359 (B) | |
| Step 3 | Divide your current rate (B) by 4 | 0.008975 (C) | |
| Step 4 | Estimated prepayment charge (A x C) | $2,243.75 |
|
Estimating Interest Rate Differential (IRD):
| | | Example
| | Your estimate
|
| Step 1 | The amount you want to prepay | $250,000 (A) | |
| Step 2 | Your current interest rate | 0.0359 (B) | |
| Step 3 | The current rate for a similar mortgage | 0.0315 (C) | |
| Step 4 | Rate difference (B - C) | 0.0044 (D) | |
| Step 5 | The number of months remaining on your current term | 24 (E) | |
| Step 6 | Estimated prepayment charge
(A x D x E) / 12 | $2,200.00 | |
Flat Rate Prepayment Estimate:
Some mortgage products may be subject to a flat rate charge. The flat rate can be calculated as follows:
| | | Example
| | Your estimate
|
| Step 1 | The amount you want to prepay (the remaining balance of your loan) | $250,000 (A) | |
| Step 2 | The flat rate (2.75%) as a decimal | 2.75% / 100 =
$0.0275 (B) | |
| Step 3 | Estimated prepayment charge (A x B) | $6,875 | |
If you received a cash-back initially on your mortgage or at renewal, you may need to repay a portion of the cash-back amount when you prepay your mortgage in full.
The amount of cash-back reimbursement is calculated as follows:
Cash-back
amount | X | Number of months remaining in your term
at the time of repayment | = | Cash-back
Repayment |
| Number of months in the term |
Use the online calculator to estimate your prepayment charges.
There are a number of factors that can affect a prepayment charge.
For the exact cost of prepaying your mortgage, please contact our customer service team at 1.888.488.0794 or send us a message through your My Mortgage account.
Notes:
- If there are less than 3 months remaining to maturity on a closed mortgage at the time of prepayment, a per-diem prepayment charge, calculated using your current interest rate, applies for the remaining term.
- For mortgages with terms greater than 5 years, after the 5th year the prepayment charge is calculated using a 3 month interest charge.
- Please refer to your mortgage documents for your specific prepayment privileges.