Mortgage prepayment penalty calculator
Pick your lender: three months' interest or the interest rate differential, estimated with that lender's published method.
Estimated penalty at Big bank (posted-rate method)$9,765interest rate differential
- Three months' interest
- $5,660
- Interest rate differential
- $9,765
- Comparison rate
- 4.46%
- 5.91% posted − your 1.45% discount
- Paid off first with your privilege
- $0
| Lender | Method | Penalty |
|---|---|---|
| RBC Royal Bank | Posted rate − your rate reduction, present value | $10,939 |
| TD | Posted rate − your discount | $9,765 |
| BMO | Posted rate − your discount, present value | $9,229 |
| Scotiabank | Posted rate − your discount, present value | $9,229 |
| CIBC (and Simplii) | Posted rate − your discount | $9,765 |
| National Bank | Posted rate at signing vs current posted rate | $9,765 |
| Desjardins | Posted rate − your rate reduction | $10,500 |
| First National | Lender's current rate | $5,660 |
| Big bank (posted-rate method) (yours) | Posted rate − your discount | $9,765 |
| Other lender (current-rate method) | Lender's current rate | $5,660 |
An estimate from the method you picked and published rates. Only your lender's payout statement is exact.
Ways to shrink it (FCAC)Use your yearly prepayment privilege first, port the mortgage to a new home, ask about blend-and-extend, or wait until the time left is shorter. Blend-and-extend calculator · Is breaking worth it?
Estimate, not advice. Educational estimate only, not financial, mortgage, tax or legal advice. Lenders, insurers and governments set their own rules and can change them; confirm with a licensed professional before you decide.
Big bank (posted-rate method): estimated penalty $9,765 with 30 months left.
Show the numbers
| Posted vs average 5-year rates | Posted 5-year | Average new 5-year+ fixed |
|---|---|---|
| 2015 | 4.79% | 3.09% |
| 2016 | 4.64% | 2.86% |
| 2017 | 4.64% | 2.72% |
| 2018 | 5.14% | 3.33% |
| 2019 | 5.34% | 3.77% |
| 2020 | 5.19% | 2.97% |
| 2021 | 4.79% | 1.96% |
| 2022 | 4.79% | 2.61% |
| 2023 | 6.49% | 5.20% |
| 2024 | 6.89% | 5.67% |
| 2025 | 6.49% | 4.59% |
| 2026 | 6.09% | 4.33% |
Assumptions & sources
Assumptions
- Penalty = the higher of 3 months' interest or the IRD on a closed fixed mortgage; 3 months' interest on a closed variable one (FCAC).
- IRD = (your rate − comparison rate) × amount prepaid × time left, discounted to present value where the lender says it does (RBC, BMO, Scotiabank). Posted-rate lenders: comparison = the posted rate for the matched term − your discount at signing.
- Lender methods come from each lender's own pages, checked November 1, 2026. Posted rates are the lender's own where published (RBC, Desjardins, First National), otherwise the Bank of Canada's typical big-bank posted rates read between terms.
- Arithmetic: the shared MITEY penalty engine.
Sources
- Financial Consumer Agency of Canada — Reduce mortgage prepayment penalties (3 months' interest or the IRD; posted-rate method; prepayment privileges; porting) (effective October 15, 2025). Checked .
- Financial Consumer Agency of Canada — Breaking your mortgage contract (fees, cash-back clawback, blend-and-extend) (effective October 15, 2025). Checked .
- TD — TD explains: what is an IRD? (posted rate for a similar mortgage minus your discount) (effective August 19, 2020). Checked .
- RBC Royal Bank — Understanding mortgage prepayment charges (posted rate less your rate reduction; present value). Checked .
- TD — What happens if you break your mortgage (IRD: posted rate for the closest term minus your discount). Checked .
- BMO — Mortgage prepayments and prepayment charges (form 5008728, 06/23) (effective 2023-06). Checked .
- Scotiabank — What you need to know about mortgages and mortgage prepayment charges (form 1343814, 07/18) (effective 2018-07). Checked .
- CIBC — Mortgage prepayment and prepayment charges. Checked .
- National Bank — Mortgage prepayment and prepayment charges guide (28612-002, 2022-12-16) (effective December 16, 2022). Checked .
- Desjardins — Paying off your mortgage early (prepayment indemnity). Checked .
- First National — Understanding prepayment charges. Checked .
- Bank of Canada — Posted conventional mortgage rate, 1-year (series V80691333) (effective October 28, 2026). Checked .
- Bank of Canada — Posted conventional mortgage rate, 3-year (series V80691334) (effective October 28, 2026). Checked .
- Bank of Canada — Posted conventional mortgage rate, 5-year (series V80691335) (effective October 28, 2026). Checked .
- Bank of Canada — Effective rate on new uninsured fixed mortgages, 5 years and over (series V122667786) (effective August 1, 2026). Checked .
- Bank of Canada — Effective rate on new uninsured fixed mortgages, 1 to <3 years (series V122667784) (effective August 1, 2026). Checked .
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