Prepayments & Calculators

Option 1: Annual 20% prepayment¹

You may make a lump sum payment of up to 20% of the principal amount owing on the mortgage at the beginning of your current term without paying a prepayment charge. Apply your savings in a lump sum deposit towards your mortgage.

Option 2: Increase your regular mortgage payment by up to 20% over your term²

You can increase your regular payment amount by up to 20% at any time or times during your term. The total of these increases during the term of your mortgage cannot be more than 20% of the regular payment amount. You may prepay more than the prepayment privilege options; however, you will be subject to prepayment charges as described in the terms and conditions of your mortgage agreement and disclosure statement.

_{¹ Minimum payment of $500. You cannot carry forward any unused portion of the prepayment privilege to a future year. Certain mortgage products restrict the day(s) on which this prepayment privilege is available. Refer to your disclosure statement or renewal agreement for more details or contact us for more information.
² Refer to your most recent disclosure statement and/or renewal agreement for more details or contact us for more information. This prepayment privilege is not available on all mortgage products.}

Tip #1: Take advantage of your prepayment privilege to increase your payment amount²

With Bridgewater Bank’s prepayment privilege, you can increase your regular mortgage payment by up to 20% over your term. That extra money will go directly towards your principal. The quicker you pay down your principal, the less interest you’ll pay.

Tip #2: Change your payment frequency³

Rather than making one mortgage payment each month, consider switching to a weekly, bi-weekly or accelerated payment schedule. You’ll pay down your principal quicker and will pay less interest over the life of your mortgage.

Tip #3: Use your prepayment privilege to make lump sum payments to your mortgage⁴

With Bridgewater Bank’s prepayment privilege, you can prepay up to 20% of the most recent original or renewed principal amount of your mortgage annually⁵.

You can save thousands of dollars in interest by using these tips. Plus, you could be mortgage-free years sooner. Some mortgage features are not available for all mortgage products. Always refer to your mortgage disclosure statement for details. See more great tips for paying down your mortgage at the Financial Consumer Agency of Canada (FCAC) website.

_{² Refer to your most recent disclosure statement and/or renewal agreement for more details or contact us for more information. This prepayment privilege is not available on all mortgage products.
³ This feature may not be available on all mortgage products.
⁴ Minimum payment of $500. You cannot carry forward any unused portion of the prepayment privilege to a future year. Certain mortgage products restrict the day(s) on which this prepayment privilege is available. Refer to your most recent disclosure statement or renewal agreement for more details. You can also contact us for more information.
⁵ For purposes of the prepayment privilege, annually means each 12 month period following the interest adjustment date and each anniversary of the interest adjustment date. Certain mortgage products restrict the day(s) on which this prepayment privilege is available. Refer to your most recent disclosure statement for more details or contact us for more information.}

What is a prepayment charge⁶?

A prepayment charge is a fee you’ll need to pay if you prepay a closed mortgage ahead of schedule. This can be a case of paying off your entire mortgage early or simply paying more than your mortgage agreement allows you to during the term of your mortgage.

When might a prepayment charge apply?

• Making a lump sum prepayment greater than what your mortgage agreement allows.
• Selling your home and not porting your mortgage to a new home. Instead, you’re using the sale proceeds to pay off your mortgage.
• Refinancing your home to borrow more money against it.
• Transferring your mortgage to another lender.

How are prepayment charges calculated?

The disclosure statement will identify which prepayment charge method applies to your mortgage and will also outline any prepayment restrictions.

_{⁶ Always refer to your most recent disclosure statement and/or renewal agreement for complete information regarding the prepayment charges applicable to your mortgage.}

If you want to pay more than your available prepayment privilege allows, the excess amount will be subject to a prepayment charge calculated as follows:

(a) If the term of the mortgage is for 5 years or less, you may prepay more than the prepayment privilege allows at any time during the term upon payment of a prepayment charge that is the greater of:

• (i) The Interest Rate Differential (“IRD”)⁷ calculated on the amount being prepaid; and
• (ii) 3 months interest at the annual interest rate of the mortgage calculated on the amount being prepaid.

(b)   If the term of the mortgage is more than 5 years, you may:

• (i) At any time during the first 5 years, prepay more than the prepayment privilege allows upon payment of the prepayment charge provided for in (a) above; or
• (ii) At any time after the 5th year of the mortgage, prepay more than the prepayment privilege allows upon payment of a prepayment charge of 3 months interest at the annual interest rate of the mortgage calculated on the amount being prepaid.

_{⁷ The IRD amount is the difference in the interest rate between the annual interest rate of the mortgage and the Government of Canada bond yield rate reported at 12 p.m. (eastern time) on the business day preceding the date you requested us to prepare your mortgage payout statement, plus 0.75%*, multiplied by the amount being prepaid, less the unused portion of the prepayment privilege, and multiplied by the time that is remaining on the term. The bond yield rate will be posted on our website at bridgewaterbank.ca or may be obtained by calling Bridgewater Bank toll free at 1.866.243.4301. *Note: This % may be different depending on the date you obtained your mortgage. Always refer to your most recent disclosure statement for complete information regarding the prepayment charges applicable to your mortgage.}

_{⁸ Each year, only on the Anniversary Date of your mortgage, you may make a lump sum payment of up to 20% of the principal amount owing on the mortgage at the beginning of your current term without paying a penalty or charge. Prepayments requested at any other time are not allowed. The prepayment cannot be more than 20% of the original principal amount without paying a prepayment charge and must be at least $500. Even though you may have prepaid less than 20% of the principal amount on previous Anniversary Dates, the unused prepayment privilege amount does not carry forward.
⁹ Payments made on the Anniversary Date will be calculated by reducing the amount being prepaid by the allowable prepayment privilege amount.}

If you’re going to make a lump sum payment, make sure that the amount is within your prepayment privilege. Every year, you can pay off up to 20% of your original or renewed principal amount in a lump sum^10&11.

If you’d like to refinance your home to borrow more money against it, consider adding a second mortgage. You’ll be able to access money from your home without having to pay out your existing mortgage.

If you’re applying for a new mortgage and suspect you might need to pay it out before the term ends, consider choosing an open mortgage instead of a closed mortgage. With an open mortgage, you can pay any amount at any time (even the entire principal) without incurring any prepayment charges.

Are you buying a new home? You may be able to “port” your mortgage. You may be able to transfer your existing mortgage’s rate and remaining term from your existing home to your new home without having to pay it out and get a new one.

If you’re going to increase your regular payment amount or make a lump sum payment, make sure that the amount is within your prepayment privilege. Every year, you can pay off up to 20% of your original or renewed principal amount in a lump sum^2&10.  You can increase your regular payment amount by up to 20% at any time or times during your term. The total of these increases during the term of your mortgage cannot be more than 20% of the regular payment amount.

If you’d like to refinance your home to borrow more money against it, consider adding a second mortgage. You may qualify to access money from your home without having to pay out your existing mortgage.

Thinking of switching your mortgage to a new lender? You may be able to negotiate with the new lender to cover your prepayment charge as a condition of switching your mortgage to them.

Learn more about mortgage prepayments at the Financial Consumer Agency of Canada (FCAC) website.

_{² Refer to your most recent disclosure statement and/or renewal agreement for more details or contact us for more information. This prepayment privilege is not available on all mortgage products.
¹⁰ Minimum payment of $500. You cannot carry forward any unused portion of the prepayment privilege to a future year. Some mortgage products restrict the day in which this payment can be made. 
¹¹ For purposes of the prepayment privilege, a year means each 12-month period following the interest adjustment date and each anniversary of the interest adjustment date. Certain mortgage products restrict the day(s) on which this prepayment is available. Refer to your most recent disclosure statement or renewal agreement for more details. You can also contact us for more information.}