Mortgage Prepayment Penalties – Just Say No.
Actually ask the lending officer to identify to you in the document where a prepayment penalty is debated. If you have not signed loan papers yet, and you realize that your loan has a prepayment penalty, you may offer to pay an extra closing point or so to determine if it can be easily removed. Most banks, particularly the ones in bigger towns, are a part of a bigger firm or rely on a huge enterprise to finance items like a house loan. If you're able to join a credit union, sign up and set up a deposit account with little monthly deposits. This way, you need to use the resources of the credit union when required. You will find local and nationwide Mortgage Financiers by doing an ad-hoc search on Google or Yahoo. If you have not signed loan papers yet, and you notice that your loan has a prepayment penalty, you could offer to pay an extra closing point or so to work out if it can be simply removed. The key at this time is that if you assent to the prepayment penalty, you must find methods to reduce either the amount, the term, or both as much as humanly possible. There are fantasically bonafide reasons that explain why you might want to pay off a note early – most frequently, due either to selling or re-financing the house.
