Mortgage penalties, also known as prepayment penalties, are fees that are charged to borrowers who pay off their mortgage early before the end of the agreed-upon term. These penalties are typically imposed by the lender as a way to compensate the for the amount of interest they would have earned had the mortgage gone full term.

The amount of the penalty will vary depending on the terms of the mortgage and the lender's policies.

It's important to carefully review the terms of your mortgage before signing on the dotted line, as mortgage penalties (especially with banks) can be significant and can add to the overall cost of the loan.