Posted on: 12th Aug, 2009 09:31 pm
Is it legal
Hi chesy,
The pre-penalty clause is mentioned in the mortgage document given to you by the lender. According to this clause, if you pay off the entire loan amount before a given time period, you will have to pay a penalty. If such a clause is mentioned in your mortgage document, then it is legal for the lender to charge you a penalty. If such a clause is not mentioned, then the lender will not be able to charge you this penalty.
Take care.
The pre-penalty clause is mentioned in the mortgage document given to you by the lender. According to this clause, if you pay off the entire loan amount before a given time period, you will have to pay a penalty. If such a clause is mentioned in your mortgage document, then it is legal for the lender to charge you a penalty. If such a clause is not mentioned, then the lender will not be able to charge you this penalty.
Take care.
yes it is legal to charge a prepayment penalty. virtually anything is legal if you agree to it.
[System detected duplicate content, converted into image. Thanks.]
Some lenders have been waiving them...Typically the penatly is equal to 6 months worth of interest...
Sometimes it makes sense to roll the penalty into the loan if there is a great enough differnce between your current rate and the rate offered...
Sometimes it makes sense to roll the penalty into the loan if there is a great enough differnce between your current rate and the rate offered...
yes its legal if the financial institution has already mention this in agreement that he will charge prepaymnt penality so it would b legal if it was not in agreement or in all the terms then its not legal...thanks