When refinancing to secure a lower interest rate or to convert between variable-rate and fixed-rate mortgages, there is a usually a penalty fee in the contract between the lender and the borrower which must be paid.
Typically, with a variable-rate mortgage, there is a prepayment penalty that is equal to three months interest. For a fixed-rate mortgage, the penalty is typically the Interest Rate Differential (IRD) which is the difference between your current rate and the rate that the lender could charge for the remainder of the term.
To find out more, call one of our Maple Leaf Mortgage experts or apply online.
Be sure to know all of the applicable penalty fees
Written by Christy Lee
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