Refinancing a mortgage is typically done to benefit from lower interest rates or to increase the mortgage amount. However, there are many implications to consider when choosing to refinance, for example, almost every mortgage loan agreement includes penalties for pre-paying the principal in full prior to maturity, referred to as breaking the mortgage. Variable rate products typically have a penalty equal to three-months’ interest amount, while fixed rate products typically have a penalty calculated by an interest rate differential method. There are a few different IRD methods, which are specified in the terms of every mortgage loan agreement, but sometimes the penalty difference on a fixed rate product can be tens of thousands dollars higher than compared to a variable rate product. In either case, our mortgage specialists can calculate the penalty amounts to help you make the best decision with your future in mind.