Should you break your mortgage?

February 28, 2015 | Posted by: Mike Garganis

Just saved a client $15,000. Is your rate above 3%?  You could be next!

I don’t advocate paying penalties, however, if there is an obvious savings to be had, then you have to do it. We have reached a point where interest rates are so low, it’s worth a review.

 

I had a new client contact me about breaking his mortgage. His rate was 3.59%. The balance was over $500,000. I reviewed his options and this was a no brainer.

Penalty to break the mortgage was under $5,000 (lucky he wasn't with a BIG SIX BANK). But the savings over the next 5 yrs would be $20,500. His net savings was $15,000.

 

A second client had $190k remaining @ 3.88%. The net savings after penalty was $8.000. Again, I recommended that my client go ahead and do it.

 

If you are in a mortgage with a rate above 3% today, then you could be losing money.

 

It’s not hard to figure out if this is worth it for you. Numbers don't lie.

 

You might save $$thousands!

 

Mike Garganis
416-481-6444
mgarganis@mortgagebymike.ca

Back to Main Blog Page

Share This Page On: