Do prepayment privileges carry over to next year?

No. Prepayment privileges reset at your mortgage anniversary date each year. Unused privilege is permanently lost and does not accumulate to the following year.

Does accelerated bi-weekly use up my lump sum privilege?

No. Accelerated bi-weekly is a separate payment frequency option. It does not count against your lump sum privilege. You can use both simultaneously.

Can I make multiple lump sum payments throughout the year?

Yes, most lenders allow multiple payments throughout the year as long as the annual total does not exceed the cap. Earlier in the year is better since money paid sooner reduces your balance for longer.

Canadian Prepayment Privileges Calculator

Calculate your annual lump sum prepayment limit and payment increase allowance by lender. Covers RBC, TD, BMO, Scotiabank, CIBC and monoline lenders. Includes accelerated bi-weekly impact and use-it-or-lose-it rules. CAD.

Lender

Original Mortgage Balance

Current Mortgage Balance

Interest Rate

Annual Lump Sum Privilege

CA$75,000

15% of original balance — use it or lose it each year

Lump Sum Privilege

CA$75,000/yr

Payment Increase Allowed

Up to 100%

Max Increased Payment

CA$5,721/mo

Extra Payment Amount

CA$2,860/mo

How TD Bank prepayment works: You can make a lump sum payment up to CA$75,000 per year without penalty. You can also increase your regular payment by up to 100%. Both privileges reset at your mortgage anniversary date — they do not carry over.

Advanced

Advanced Analysis

Lender comparison, accelerated bi-weekly, double-up payments

Prepayment privileges vary significantly between lenders. Compare the Big 5 banks on both dimensions.

Lender	Annual Lump Sum	Lump Sum on CA$500,000	Payment Increase	Double-Up?
RBC Royal Bank	10% of original	CA$50,000	Up to 10%	No
TD Bank	15% of original	CA$75,000	Up to 100% (double-up)	Yes
BMO Bank of Montreal	20% of original	CA$100,000	Up to 20%	No
Scotiabank	15% of original	CA$75,000	Up to 15%	No
CIBC	10% of original	CA$50,000	Up to 100% (double-up)	Yes
Monoline Lender (typical)	20% of original	CA$100,000	Up to 20%	No

Important: These are typical privileges for standard products. Actual privileges depend on your specific mortgage product and agreement. Always check your mortgage commitment letter or call your lender. Some monolines and credit unions offer up to 25% lump sum privileges.

Pro

Professional Simulator

Maximize privileges for early payoff, use-it-or-lose-it impact, penalty warnings

Using full privileges every year plus accelerated bi-weekly can dramatically shorten a 25-year mortgage.

Current Amortization

25 years

With regular payments only

With Max Lump Sum Only

6 yrs 4 mo

Annual CA$75,000 lump sum

With Accelerated Bi-Weekly

22 yrs 5 mo

Bi-weekly switching only

Years Saved (Lump Sum)

19 yrs 8 mo

Vs regular monthly

Full privilege strategy: Using accelerated bi-weekly + max annual lump sum (CA$75,000/yr) + maximum payment increase can reduce a 25-year mortgage to as few as 17-19 years — saving 6-8 years of interest. The lump sum does not need to be paid all at once — some lenders accept multiple smaller prepayments throughout the year up to the annual cap.

How to Use This Prepayment Privileges Calculator

Select your lender, enter your original mortgage balance (used to calculate the annual lump sum cap), current balance, and interest rate. The calculator shows your maximum lump sum without penalty and your payment increase allowance.

What Are Prepayment Privileges?

Canadian mortgage contracts include prepayment privileges that allow you to pay down your mortgage faster without triggering a prepayment penalty. Two main types exist:

Annual lump sum privilege: Pay a percentage of the original balance (typically 10-20%) as extra principal each year
Payment increase privilege: Increase your regular payment by a percentage (10-100%) for the rest of the term

Both privileges reset at your mortgage anniversary date each year. Unused privileges are permanently lost — they do not accumulate.

Big 5 Bank Prepayment Privileges Comparison

RBC: 10% lump sum / 10% payment increase
TD: 15% lump sum / 100% double-up payment
BMO: 20% lump sum / 20% payment increase
Scotia: 15% lump sum / 15% payment increase
CIBC: 10% lump sum / 100% double-up payment

Note: Privileges vary by product — check your mortgage agreement.
Monoline lenders often offer 20% + 20% or better.

TD and CIBC offer the most flexible payment option: the ability to double your regular payment on any payment date. BMO and monolines typically offer the highest lump sum percentage.

Example: Maximizing Privileges at TD Bank

Priya — $500,000 Mortgage, 5.25%, 25-Year Amortization

Original Balance	$500,000
Annual Lump Sum (15%)	$75,000/yr
Regular Payment	$3,074/mo
Double-Up Option	Extra $3,074/mo
Accelerated Bi-Weekly	$1,537 every 2 weeks
Normal Payoff	25 years
With Max Lump Sum Only	~19 years
Years Saved	~6 years

Using full privileges + accelerated bi-weekly, Priya can realistically pay off a 25-year mortgage in 17-19 years — saving 6-8 years of interest payments.

Frequently Asked Questions

No. Prepayment privileges reset at your mortgage anniversary date each year. If you do not use your full lump sum privilege in one year, it is permanently lost. For example, if you have a 15% privilege and only use 10%, the remaining 5% is gone when the anniversary date passes.

For most Big 5 banks, the annual lump sum privilege is calculated on the original mortgage balance at the start of the current term — not your current outstanding balance. This means your maximum lump sum does not decrease as you pay down the mortgage, which is advantageous. Always verify with your lender as some products use current balance.

Exceeding your annual privilege triggers a prepayment penalty on the excess amount. For fixed-rate mortgages, this is typically the greater of 3 months interest or the Interest Rate Differential (IRD). For variable-rate mortgages, usually just 3 months interest. On a large excess and high-rate mortgage, this penalty can be several thousand dollars.

No. Accelerated bi-weekly is a payment frequency option, not a prepayment. It is separate from your lump sum privilege. By paying half your monthly payment every two weeks, you make 26 half-payments (equivalent to 13 monthly payments) per year — effectively one extra monthly payment annually without touching your lump sum privilege.

Yes, most lenders allow multiple payments throughout the year as long as the total does not exceed the annual cap. For example, if you have a $50,000 privilege, you could make five $10,000 payments throughout the year. Some lenders require a minimum amount per payment. Earlier in the year is always better — money paid sooner reduces the balance longer.