Mortgage Penalty Calculator
Estimate what it could cost to break your mortgage early — before you commit to refinancing or switching lenders.
Type exact values (cents included) or drag a slider to get close. To fine-tune, click the slider and press Left arrow keyRight arrow key on your keyboard: each press moves mortgage amounts by $100 and interest rates by 0.01%.
Type an exact value from $50,000 to $1,500,000. Dragging the slider moves quickly. With the slider focused, press the left or right arrow key to move in steps of $100.
Type an exact value from 2.00% to 10.00%. Dragging the slider moves quickly. With the slider focused, press the left or right arrow key to move in steps of 0.01%.
Type an exact value from 1.00% to 8.00%. Dragging the slider moves quickly. With the slider focused, press the left or right arrow key to move in steps of 0.01%.
Type an exact value from 1 to 60. Dragging the slider moves quickly. With the slider focused, press the left or right arrow key to move in steps of 1.
Big-bank IRD calculations often use posted rates and can be much higher. Always get an exact payout quote — sometimes the penalty is still worth paying.
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Get Exact Numbers — Free CallHow the Mortgage Penalty Calculator Works
Breaking a mortgage before the end of its term usually triggers a penalty. Variable-rate mortgages typically charge three months’ interest; fixed-rate mortgages charge the greater of three months’ interest or an interest rate differential (IRD), which can be significantly higher.
This calculator estimates that cost so you can weigh it against the savings from refinancing, switching lenders, or paying off your mortgage early.
4 Steps to Your Results
Fixed-rate mortgages use the greater of three months’ interest or IRD; variable-rate mortgages use three months’ interest only.
Your current outstanding balance and the rate you’re paying today.
The rate your lender currently offers for a term matching your remaining time left — this drives the IRD calculation.
How many months are left in your current term determines both the IRD and, for fixed mortgages, which penalty applies.
On a fixed-rate mortgage with a $400,000 balance at 5.34%, a lender comparison rate of 3.99%, and 30 months remaining in the term, three months’ interest comes to about $5,340, while the IRD estimate comes to about $13,500.
Since it’s a fixed mortgage, the penalty is the greater of the two — $13,500 in this example.
Big-bank IRD calculations often use posted (not discounted) rates and can run even higher than this estimate — always request an exact payout quote from your current lender before deciding.
Frequently Asked Questions
An Interest Rate Differential penalty compensates the lender for the difference between your original rate and their current rate for a term matching your remaining time — it can be substantial when rates have dropped.
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