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hopptx
Joined: 21 Sep 2009
hopptx's page
Posts: 1
20 Magic Points
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Subject: if approval of a house loan, and i pay it off early will i b
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Mon Sep 21, 2009 2:02 pm
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| I was wondering if i get a home loan and try to pay it off early will i get pentalized and how much if so: |
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Justin
Joined: 17 Jul 2006
Justin's page
Posts: 1093
25288 Magic Points
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Tue Sep 22, 2009 6:16 am
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Hi Hopptx,
Yes, there is a chance that you might be penalized if you repay the home loan before the due date. However, there is no fixed rate as to how much you have to pay. It depends on the lender of the home loan. You should check the documents carefully before you sign. See all the terms and conditions on the document and analyze whether or not that would help you. Check carefully whether or not you are deriving any benefit, such as lower interest rate or lower fees out of a prepayment pay off plan.
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Justin |
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carol
Joined: 27 Jun 2006
carol's page
Posts: 1308
28489 Magic Points
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Tue Sep 22, 2009 6:40 am
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Hi hopptx
| Quote: | | I was wondering if i get a home loan and try to pay it off early will i get pentalized and how much if so: |
While it is a fact that you will be considered as a good debtor if you pay off a mortgage loan early, it is also true that there is something called a 'prepayment penalty' in mortgage.
Yes, you will be penalized for paying off a mortgage loan early. It is a clause or provision in your contract with the lender that mentions that you must pay a penalty in the event that you pay off a loan early. It is usually a percentage of the total outstanding amount at the time you are making the prepayment or maybe interest for a specific number of months put together.
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Carol |
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sunnyca
Joined: 10 Sep 2009
sunnyca's page
Posts: 150
950 Magic Points
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Wed Sep 23, 2009 5:38 am
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That woudl depnd on the agreemtn you have
Some of the lenders have may impose penanlty if you pay off the loan early or make some additional payments on the princiapl. But most of it will in the early years |
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