Pacman
07-15-2013, 10:31 AM
I'm curious about this, as there seems to be a lot of conflicting information out there. I know there are some experts on here who may shed some light on this.
Assume you are on a restrictive type of mortgage ( fixed, closed mortgage, 5 year term)
Let's say you take advantage of the pre-payment schemes the bank offers you (doubling payments, increasing payments by 10% each year, 10% lump sum payments once a year, accelerated weekly payments etc) and you end up paying off the mortgage before the end of the 5 year term.
Do you get charged a penalty for paying off the mortgage early, even though you are simply following and taking advantage of the banks payments methods?
I understand the banks charging penalties for someone who walks in, makes one massive lump sum payment to get out of the mortgage, and then goes and gets another mortgage for a lower interest rate somewhere else....
Pac
Assume you are on a restrictive type of mortgage ( fixed, closed mortgage, 5 year term)
Let's say you take advantage of the pre-payment schemes the bank offers you (doubling payments, increasing payments by 10% each year, 10% lump sum payments once a year, accelerated weekly payments etc) and you end up paying off the mortgage before the end of the 5 year term.
Do you get charged a penalty for paying off the mortgage early, even though you are simply following and taking advantage of the banks payments methods?
I understand the banks charging penalties for someone who walks in, makes one massive lump sum payment to get out of the mortgage, and then goes and gets another mortgage for a lower interest rate somewhere else....
Pac