1. What is RBC Mortgage Prepayment?

RBC mortgage prepayment allows you to pay more than your regular mortgage payment, which can help you pay off your mortgage faster and save on interest costs. RBC typically allows certain prepayment privileges each year.

2. How Does the Calculator Work?

The calculator uses the simple prepayment formula:

Where:

• \( Balance \) — Current mortgage balance ($)
• \( PrepayRate \) — Allowed prepayment rate (percentage)

Explanation: The calculation determines how much you can prepay based on your current mortgage balance and RBC's prepayment allowance percentage.

3. Importance of Prepayment Calculation

Details: Understanding your prepayment options helps you make informed decisions about paying down your mortgage faster, potentially saving thousands in interest payments.

4. Using the Calculator

Tips: Enter your current mortgage balance in dollars and RBC's allowed prepayment rate as a percentage (e.g., 10 for 10%).

5. Frequently Asked Questions (FAQ)

Q1: What are RBC's standard prepayment privileges?
A: RBC typically allows prepayment of 10-20% of the original principal annually, but check your specific mortgage terms.

Q2: Are there penalties for prepaying my RBC mortgage?
A: No penalties if you stay within your prepayment privileges. Exceeding them may trigger penalties.

Q3: How does prepayment affect my amortization?
A: Prepayments reduce your principal faster, shortening your amortization period and reducing total interest paid.

Q4: Can I make lump sum prepayments?
A: Yes, RBC allows lump sum prepayments up to your annual limit, in addition to increasing regular payments.

Q5: Where can I find my prepayment privileges?
A: Check your mortgage agreement or contact RBC directly for your specific prepayment terms.