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I Broke My Mortgage: How to Validate I Made the Right Choice?

Post-break verification grid to confirm the profitability of your decision

Penalty3 min readFebruary 11, 2026
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After breaking your mortgage, it is essential to validate that the decision was financially advantageous. Too many Quebec borrowers sign their new mortgage contract without conducting a rigorous post-decision review. The post-break verification grid allows you to compare total actual costs (break penalty, notary fees, appraisal fees, discharge and cancellation fees at the Quebec land registry) with the savings achieved through your new rate. The break-even calculation is the central tool for this validation: it determines how many months of monthly payment savings are needed to offset all costs incurred. If your break-even point falls within the first 24 months and you have at least 36 months remaining on your new term, your decision is generally profitable. AMF-certified mortgage brokers in Quebec recommend redoing this calculation with actual figures once the transaction is completed at the notary, rather than relying solely on initial estimates. OSFI and CMHC publish guidelines on refinancing best practices that emphasize the importance of this verification. Keep your penalty statement from the previous lender, your new mortgage contract, and the notary invoice to document your analysis.

Validating Your Decision to Break Your Mortgage

You broke your mortgage to take advantage of a better rate or to consolidate debts. The transaction is complete, papers are signed at the notary, and your new lender is now processing your monthly payments. But did you truly make the right choice? Too many Quebec borrowers move on without verifying the actual numbers. A rigorous post-decision validation is essential to confirm the profitability of your refinancing.

The Break-Even Calculation With Actual Figures

The break-even point is the number of months needed for your monthly savings to offset all costs incurred during the break. Before the transaction, this calculation relied on estimates. Now that everything is finalized, you can use actual amounts. The formula is straightforward: divide the total of all your fees by the actual monthly savings. For example, if your total costs amount to $6,500 and you save $325 per month, your break-even is 20 months. If your new term is 60 months (5 years), you will therefore benefit from 40 months of net savings.

  1. Gather all documents: Obtain the penalty statement from your previous lender, the notary invoice (including fees, discharge, and publication at the Quebec land registry), the appraisal report, and any other fees charged by your new or former lender.
  2. Calculate total actual costs: Add up the break penalty, notary fees, discharge and cancellation fees, property appraisal fees, title insurance (if applicable), and lender administrative fees. Do not miss any amount.
  3. Déterminé actual monthly savings: Compare your former monthly payment with your new payment. The difference is your monthly savings. Make sure to compare equivalent terms (same payment frequency, same remaining amortization).
  4. Calculate the break-even point: Divide total costs by monthly savings. The result is the number of months to reach profitability. Compare this with the number of months remaining on your new term.
  5. Evaluate and document: If your break-even point is significantly less than the remaining term, your decision is profitable. Keep your analysis with all documents for future reference and for your AMF-certified mortgage broker.

Commonly Underestimated Costs

One of the most common mistakes is underestimating total fees during the initial estimate. In Quebec, notary fees for a mortgage refinance typically range from $1,200 to $2,000, including professional fees, discharge of the previous mortgage, and registration of the new one at the land registry. Appraisal fees, when required by the new lender, add $300 to $500. Cancellation of the previous mortgage at the land registry costs an additional $200 to $400. Title insurance, recommended but not always mandatory, runs $200 to $500. Some lenders also charge administrative discharge fees of $200 to $300.

Post-Break Verification Checklist

  • Does the actual penalty match the estimate provided by the former lender? A gap greater than 5% warrants verification with the institution.
  • Are notary fees consistent with the initial quote? Notaries in Quebec are required to provide a cost estimate before proceeding.
  • Does the new rate obtained match the rate promised in the submission? Verify the rate confirmation in your mortgage contract.
  • Is the remaining amortization correct? A longer-than-expected amortization reduces your apparent monthly savings.
  • Have all ancillary fees been accounted for? Discharge, title insurance, appraisal, lender administrative fees.
  • Does the actual monthly savings match projections? Compare your first payment statement with the previous one.

Beyond the Numbers: Qualitative Benefits

Post-decision validation is not limited to the numbers. Certain qualitative benefits can justify a mortgage break even if the break-even period is long. Consolidating high-rate debt (credit cards at 20% or more) into a single mortgage payment reduces financial stress and simplifies budget management. Switching from a collateral mortgage to a conventional mortgage facilitates a future lender transfer. Obtaining more generous prepayment privileges offers increased flexibility. The Civil Code of Quebec (CCQ) and the Act respecting the distribution of financial products and services (LDPSF) govern the obligations of lenders and brokers, ensuring the borrower has the information needed to evaluate their decision holistically.

Frequently Asked Questions

How do I know if I made the right decision to break my mortgage?
Redo the break-even calculation with actual figures: add up all costs (penalty, notary, appraisal, discharge) and divide by the actual monthly savings on your payments. If the resulting number of months is less than the time remaining on your new term, your decision is profitable. The shorter the break-even, the better the decision.
What documents should I keep after breaking my mortgage?
Keep the penalty statement from your previous lender, the land registry discharge confirmation, the notary invoice, the appraisal report (if applicable), your new mortgage contract, and your first payment statements at the new rate. These documents will help document your financial analysis and may be useful for tax purposes.
How soon after the break should I do this verification?
Ideally, do an initial review once you have all final documents in hand, generally within 30 to 60 days of the notary transaction. Then do a follow-up check at 6 months and 12 months to confirm that savings are materializing as expected.
What if my break-even is longer than expected?
If the break-even exceeds your term maturity, it does not necessarily mean the decision was wrong. Evaluate non-financial benefits: better flexibility of the new product, consolidation of high-rate debt, peace of mind with a fixed rate. Consult your AMF-certified broker for a complete analysis.
Can a mortgage broker help with this validation?
Yes. AMF-certified mortgage brokers in Quebec generally offer post-transaction follow-up. They have precise calculation tools and can compare your actual situation with initial projections. Under the LDPSF, the broker has an obligation to act in your best interest, which includes follow-up after signing.
Can forgotten fees make my decision unprofitable?
Yes, this is a common pitfall. Some borrowers forget to include discharge fees ($200 to $400), title insurance ($200 to $500), appraisal fees ($300 to $500), or lender administrative fees ($200 to $300). These fees can represent an additional $1,000 to $1,700 that extends the break-even by several months.

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Educational information only. This does not constitute financial advice under the Act Respecting the Distribution of Financial Products and Services (LDPSF). Consult an AMF-certified mortgage broker before making any financial decision.

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