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Breaking fixed interest mortgage contracts
ANNOUNCEMENT
The ValueAdd Company
20th January
2009
Breaking fixed interest mortgage
contracts
It would appear that the calculation of a “break fee” for terminating fixed interest mortgages by financial institutions, according to some reports, is more of an art than a science!
The basis of the charge is that the contracted interest on a given mortgage fixed for an agreed term will be substantially reduced in the current interest rate environment if that advance is repaid early and a new advance made. Until now it seems to be a matter of speculation as to what “break fee” is reasonable and what is not.
The ValueAdd Company has today launched an online calculator (visit) designed to take the guesswork out of the implications of re-financing a mortgage that involves cancelling a fixed interest contract. The benefits, if any, for the homeowner can be easily calculated.
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