RBC penalty calculator
RBC Royal Bank mortgage penalty calculator
Short answer: RBC charges the greater of 3 months’ interest or IRD vs RBC’s posted rate for a similar term, less your rate reduction. Variable: 3 months’ interest. This calculator uses RBC’s own posted rates (read November 2, 2026; from the MITEY lender-rate dataset) to price your mortgage and shows whether breaking pays before your term ends.
Estimate what it would cost to break a RBC fixed mortgage, using RBC’s own posted rates (November 2, 2026) and the penalty rule RBC publishes. Then see whether breaking pays and how waiting cuts the cost.
RBC Royal Bank · estimated cost to break today
$8,951
IRD applies
RBC: greater of 3 months’ interest or the IRD against its posted rate for the closest term (2-yr posted), less your discount.
Moving to 5.14% would save about $7,498 in interest over the 21 months left, so you’d be $1,453 behind after the penalty. Waiting for renewal, or porting, is likely cheaper.
Break-even new rate: 4.96%. Below that, breaking pays before your current term would have ended. Ignores legal, appraisal and discharge fees. For a full refinance break-even with fees, see Revalued.ca.
Waiting cuts the penalty
If posted rates stay where they are, waiting 6 months brings the estimate to $6,994; at maturity it’s $0. Early renewal at RBC: Up to 120 days early, no penalty.
Three ways to pay less
- Prepay first. Using this year’s privilege first lowers the base the penalty is charged on (10% lump sum a year, 10% payment increase every 12 months, plus double-up payments.)
- Port instead of breaking. Port when buying and selling at the same time; extra money can be blended at the current rate.
- Blend and extend. FCAC describes early renewal at a blended rate as a way to avoid a full penalty. Ask RBC for a quote.
RBC’s own penalty page ↗ · always get the bank’s written payout figure.
The same mortgage at each big bank
Same balance, rate, discount and time left, priced with each bank’s own posted table (Nov 2, 2026) and the formula it publishes. This shows how much the bank’s penalty rule and posted table matter.
| Bank | Estimated penalty | 3 months’ | Compares with |
|---|---|---|---|
| RBC | $8,951 | $7,080 | 2-yr posted 5.74% |
| TD | $11,799 | $7,080 | 2-yr posted 5.39% |
| National Bank | $13,011 | $7,952 | 1- and 2-yr rates, interpolated for 21 months 5.30% |
| Scotiabank | $13,020 | $7,080 | 2-yr posted 5.24% |
| CIBC | $13,020 | $7,952 | 2-yr posted 5.24% |
| BMO | $15,461 | $7,080 | 2-yr posted 4.94% |
Estimates use simple interest over the months left (as in FCAC’s example); RBC and Scotiabank say they use a present-value basis, which lowers the real figure somewhat. For a term over five years broken after year five, the Interest Act caps the charge at 3 months’ interest, and the analyzer applies that. Today’s month is taken from your device; rates are as published on November 2, 2026.
RBC’s rule, in its own words
- Fixed rate: the greater of three months’ interest on the amount prepaid, or the interest rate differential (IRD) for the remainder of the term.
- IRD comparison: the difference between your rate and RBC’s posted rate on the prepayment date for a similar term, “less your rate reduction”. RBC says it applies present value, which lowers the result.
- Closed variable (and RateCapper): 3 months’ interest on the amount prepaid.
- Clients whose mortgages migrated to RBC in 2024 have separate published terms; check RBC’s page for migrated clients.
RBC posted rates used in the calculation
| Term | Posted rate |
|---|---|
| 1-year | 5.74% |
| 2-year | 5.74% |
| 3-year | 6.25% |
| 4-year | 6.09% |
| 5-year | 6.19% |
| 7-year | 6.50% |
| 10-year | 6.90% |
Online estimates are a starting point. Ask RBC for a written payout statement before you sign anything with another lender, or try RBC’s own calculator.
Frequently asked questions
How does RBC calculate its mortgage prepayment penalty?
Greater of 3 months’ interest or IRD vs RBC’s posted rate for a similar term, less your rate reduction. Variable: 3 months’ interest. See the RBC profile for the bank’s exact wording and source.
Which RBC posted rate is used?
The posted rate for the term closest to the time left in your term. RBC’s posted fixed rates on November 2, 2026: 1-year 5.74%, 2-year 5.74%, 3-year 6.25%, 4-year 6.09%, 5-year 6.19%, 7-year 6.50%, 10-year 6.90%.
How can I lower a RBC penalty?
Use your prepayment privilege first (10% lump sum a year, 10% payment increase every 12 months, plus double-up payments.), ask about porting (port when buying and selling at the same time; extra money can be blended at the current rate.), or wait: up to 120 days early, no penalty.
Sources
- Mortgage rates — RBC Royal Bank, checked Nov 2, 2026
- Understanding mortgage prepayment charges — RBC Royal Bank, checked Oct 31, 2026
- Reduce or avoid prepayment penalties — FCAC, checked Oct 31, 2026
Keep exploring
Other banks: TD · Scotiabank · BMO · CIBC · National Bank
Educational information only, not financial, legal or tax advice. BankMortgages.ca is independent and is not affiliated with, endorsed by or paid by any bank named on this site. Bank terms change: confirm every rate and term with the lender and the official sources linked on each page before you act. Read the full disclaimer.
