In the current economy, with interest rates running at an all time low, home owners must be very careful when selling their home and paying off the existing mortgage. All mortgage lenders will charge a discharge free for early pay-out of a mortgage and almost all lenders now charge “the interest differential to the end of the term” instead of 3 months penalty. This can result having to pay a very large penalty on top of the mortgage balance when you sell your home.
Before you accept an offer to sell your property make you have a quote “in writing” from your financial institution outlining the cost of the penalty to pay out the mortgage.
Courtesy of Betty Talbot - AMP Mortgage Agent, CENTUM Omni Mortgage Corp.