Does a cashback from a new bank remove the break cost?

Not necessarily. Cashback can offset part of the switching cost, but you still need to include break fees, solicitor costs, and any other charges to see the real net cost.

When is breaking a fixed mortgage worth considering?

Breaking can be worth considering when rates have dropped enough that the savings over the remaining fixed term are greater than the break fee and other refinance costs.

Break Cost Estimator

Estimate if breaking your fixed rate mortgage could save you money

Note: This calculator provides estimates only. Actual break costs are calculated by your bank based on wholesale rates and can vary significantly. Always get an exact quote from your lender before making decisions.

Current Loan Balance

Current Fixed Rate (%)

New Rate Available (%)

Months Remaining on Fixed Term

Estimated Break Cost

Ask your bank for an exact quote. Break costs vary significantly.

Cash Contribution from New Bank

Estimated at 0.85% of lending ($4,250). Ask your broker about current cash incentives.

Solicitor's Cost

Solicitor costs may increase with additional complexities.

Breaking Could Save You

$3,535

Over remaining 18 months

Net Cost to Refinance

$2,250

Break Cost:$5,000

Solicitor:$1,500

Cash Back:-$4,250

Current Payment

$3,160/mo

New Payment

$2,839/mo

Savings Analysis

Monthly Savings$321

Annual Savings$3,857

Break Cost Payback7.0 months

When to Consider Breaking

• Rates have dropped significantly since you fixed
• You have a long time remaining on your fixed term
• Monthly savings exceed break cost over remaining term
• You're selling the property anyway

What a break cost actually means

A break cost is the lender's estimate of the loss they take if you exit a fixed rate early. It is not a flat fee, and it can change quickly as wholesale rates move.

That means two borrowers with similar loan sizes can get very different break quotes depending on their fixed rate, remaining term, and market conditions on the day the bank calculates it.

How to use this estimate properly

Use this calculator as a screening tool, not a final decision-maker. If the numbers look promising, the next step is to get a live break quote and compare it against the exact refinance offer.

Get the lender's current break quote in writing.
Confirm legal fees, discharge costs, and valuation requirements.
Check whether the new bank's cashback changes the overall equation.

Break cost FAQs

Can break costs change from day to day?

Yes. Break costs are linked to market rates, so they can rise or fall even if your loan balance has barely changed. That is why a fresh quote matters.

Does a cashback from the new bank cancel out the break fee?

Sometimes it offsets a large part of it, but not always. You still need to include solicitor fees and any other switching costs to see the real net position.

Should I break just because rates have dropped?

Not automatically. The better question is whether the savings over your remaining fixed term are larger than the total cost of switching.

Disclaimer: This calculator provides estimates only and should not be relied upon for financial decisions. Actual loan terms, rates, and eligibility may vary. Please contact a Mortgage Lab adviser for personalised advice.