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Thread: Breaking mortgage to take advantage of current mortgage interest rate?

  1. #1

    Default Breaking mortgage to take advantage of current mortgage interest rate?

    I have a fixed 3% mortgage with First National. Have 10 months left in the first 5y-term (30 year amort). I will cost me $2300 to break my current term and renew. Should I break the mortgage now or wait till August to early renew? Have $310,000 outstanding, every 0.25% interest rate hike costs me $2000 extra in interest over next 5 year fixed term. First National offered me 3.14% If I'd renew today, but could probably get lower from a broker, maybe 2.8%.

    Should I wait till August to early renew or just break the term now and refinance while fixed rates are a little lower? My understanding it that the 5-year yield is forward looking. And I assume it will be higher forward looking in August when I can early renew. renewal then?


  2. #2


    If you take First National's offer, see if you can get them to waive the break fee. You're signing up for a higher interest rate than what you have now, after all.

  3. #3


    A 3.14% refinancing rate is a pretty good rate. So I would recommend that you renew your mortgage today. I don't think you'll feel much difference if you do this now but not in August. The offer at First National is very good. Too bad I didn't have such offers when I also had a mortgage. I rarely see such a low rate of renewals. I have read a lot of Online Loan Reviews, and I haven't encountered anything related to such a low rate. So do not hesitate to renew the loan. You will certainly not regret it.

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