It’s been a busy few weeks…rates have been climbing and a lot of clients have been calling wondering what to do next. My response is pretty quick, “Yeah rates are up so now you can save money!” How? Well, if you have a mortgage rate at 5% – 5.5% now that rates are on the way up you may be able to save your Interest Rate Differential (IRD) and only pay 3 months penalty.
IRD is a term the banks like to toss around to help make things confusing for consumers. It is in essence a formula they use to calculate the penalty for breaking your mortgage. It is amounts to the difference between your old rate and current rates for your remaining term.
Feel free to contact me if you would like to know more.