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Breaking a mortgage can be costly as rates fall. How to lessen the penalty - National | Globalnews.ca

Global News
Summary
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68% Informative

Canadian homeowners are likely to break their mortgages mid-term to take advantage of lower rates in the market.

Breaking a mortgage boils down to exiting the contract with a lender before the maturity date.

The penalty is equal to three months ’ worth of interest, based on prime rate or contract rate.

When rates are falling, the penalty is more likely to come into play.

Some lenders may discharge the old mortgage and start on a clean slate” with a new loan at today ’s rates.

Some lenders will also offer cashback rewards or bonuses for borrowers willing to switch.

For Canadians keen to take advantage of lower interest rates in a refinancing deal, Tran warns.

VR Score

72

Informative language

74

Neutral language

41

Article tone

informal

Language

English

Language complexity

47

Offensive language

not offensive

Hate speech

not hateful

Attention-grabbing headline

not detected

Known propaganda techniques

not detected

Time-value

medium-lived

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