Mortgage Prepayment Penalty Calculator
FinanceCalculate your mortgage prepayment penalty using the greater of the three-months'-interest and interest-rate-differential (IRD) methods.
Prepayment Penalty Owed
Your prepayment penalty -- lenders typically charge whichever of the two methods produces the larger amount.
Three-Months'-Interest Method
$3,125.00
Interest Rate Differential (IRD) Method
$15,000.00
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Mortgage Summary
Your loan of $0 will be paid off by Sep 2056 with total interest of $0.
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Odeh Ahwal0people find this calculator helpful
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Frequently Asked Questions
How is a mortgage prepayment penalty calculated?
Lenders typically charge the greater of two methods: Three-Months'-Interest (Balance x Current Rate / 4) or the Interest Rate Differential (Balance x (Current Rate - Posted Rate) / 12 x Months Remaining).
When does the IRD method produce a bigger penalty?
IRD tends to be larger when your current rate is well above the rate a lender could get by re-lending your remaining balance today (the posted rate) -- common when rates have fallen since you locked in your mortgage.
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