Mortgage Break Costs — What They Are and How to Calculate Them

Mortgage break costs apply when you exit a fixed rate loan before the end of the fixed period, and can range from zero to tens of thousands depending on the rate differential.

How are mortgage break costs calculated?

Break costs are based on the interest rate differential between your fixed rate and the current wholesale rate, multiplied by the loan balance and remaining fixed term. Request a break cost estimate from your lender before deciding.