"trader_4" wrote in message
...
On Tuesday, March 2, 2021 at 12:44:39 AM UTC-5,
wrote:
On Mon, 1 Mar 2021 23:07:18 -0500, Ralph Mowery
wrote:

In article ,
says...

On the other hand, those who got variable rates in 1992 when they
were starting at 9.25%, made out quite well as they quickly dropped
to 7 and later 5%.



When the rates drop one can usually negociate for the lower rates even
on fixed rates, or go to another bank (lender).

You'd need to buy your way out of the mortgage
- the penalty is usually the interest they are losing
plus a fee for the trouble.

Is that how it works in Canada?

And in Australia too.

Not here in the US. I've never seen a mortgage
with a pre-payment penalty at all

Thats not the same thing, most obviously when you sell the house.

and I would bet that it's probably illegal in many states.

I've refinanced many times with no penalty. The only costs are whatever
it
takes to get the new mortgage, eg application fee, appraisal fee, misc
fee, etc.