Mortgage Penalty Calculator

Estimate your prepayment penalty for breaking a mortgage early — the greater of three months' interest or the interest rate differential (IRD).

Breaking a mortgage early triggers a penalty — and on fixed mortgages it can be far larger than people expect. Knowing the number helps you weigh whether refinancing now still comes out ahead.

Have a real scenario? Talk it through — Refinance

Remaining balanceYour contract rateLender's current rate (comparison)Used for the IRD calculation on fixed mortgages.Months remaining in termFixed-rate mortgage (uncheck for variable)

$18,750

Estimated penalty

Three-month interest: $6,250
Interest rate differential (IRD): $18,750
Penalty method: IRD (greater)

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Terms, in plain language

Prepayment penalty: A fee for paying off or breaking your mortgage before the term ends. Lenders charge the greater of two formulas below.
Three-month interest: A simple penalty equal to roughly three months of interest on your balance — common on variable-rate mortgages.
Interest rate differential (IRD): A penalty based on the gap between your rate and current rates, multiplied by the time left in your term. On fixed mortgages with a big rate gap, this can be much larger than three months’ interest.