Is it worth it to break your mortgage early for today’s record low rates? In a word, yes. In many cases, getting out of a mortgage where you are paying more than 3% for a mortgage rate of 1.89% today is often worth it.
A recent piece by Rates.ca gives an example of a client who had mortgage at 3.39%. He now could get 1.99%. The penalty was high’ over $32,000 but his broker showed him that by making a penalty free 20% prepayment and then re-investing his savings in prepayments over the next 5 years, he saved an additional $19,248.
This strategy doesn’t work for everyone but it’s worth checking out your options. Call me if you want to crunch the numbers. Maybe we can save you thousands on your mortgage today.