Finance Articles

Mortgage Prepayment Penalties - Just Say No

One of the most common terms found in a new home loan is a prepayment penalty. This type of penalty says that if the borrower pays off the loan early, commonly during the first five years of the loan, then the borrower will be responsible for paying an additional amount of money, typically about six months interest on 80% of the mortgage balance. Sub-prime market loans will typically carry prepayment penalties more than standard mortgage loans.

You may plan on keeping the house for the entire duration of the prepayment penalty, and be tempted not to worry about it much. But sometimes life circumstances change, so it's wise to avoid any type of prepayment penalty if you can. A typical prepayment penalty might equal five months worth of monthly loan payments, so it's worth checking on. Of course, you should always ask (before you sign) if a new loan has a prepayment penalty. In fact, ask the lending officer to point out to you in the document where a prepayment penalty is discussed.

Most items in a loan are subject to negotiation. If you haven't signed loan papers yet, and you find that your loan has a prepayment penalty, you might offer to pay an additional closing point or so to see if it can be removed. The key at this stage is that if you agree to the prepayment penalty, you should try to find ways to reduce either the amount, the term, or both as much as possible.

If you already have a loan, you are bound by the terms of the document, unless you can negotiate them. There are perfectly legitimate reasons why you may want to pay off a note early - most often, due either to refinancing or selling the house. You may be able to contact your lender to see if they will waive the prepayment penalty if they are able to provide refinancing. If interest rates have dropped a lot, and you can't get out of the prepayment penalty, it may be worth rolling that amount into a new loan. And of course, try to get the new loan without a prepayment penalty.

About The Author

Jakob Jelling is the founder of http://www.cashbazar.com. Visit his website for the latest on personal finance, debt elimination, budgeting, credit cards and real estate.

Other Article Sites

findabook.com  moneycd.info  a-mortgage.info   about-lemon-laws.info  aboutstudentloans.info
all-about-publishing.info  auctions-articles.info  bestcollege-university.com  bestispconnection.com
biblefolder.com  blogger-website.com  books-used.info  brokers-guide.info  buywindows.info  cable-dsl.info
career-miner.com  carpel-tunnel.info  cashinaflash.info  cashloanreviews.info  casinobell.com  chat-house.info
clearmycredit.info  collegeloantips.info  crones.info  depression-articles.info   dirnic.net  dishguides.info
divers-below.com  expodog.info   financewizz.com  fire-insurance.info  getgood.info  handleit.net   it-idea.info
health-supplies.info  hosting-right.com  insidealert.com  insurance-facts.info  jobs-employment.info
justgood.info  lookgold.net   lowcost-travel.info  money-source.info  myhostzone.info  numisblog.com
peoplesearchfinder.info  pr-articles.info  realeas.com   refinancing-guides.info  spyware-remove.info
telelot.info  the-law.info   toppaid.info  travel-deals.info  travelcorrect.com  wedding-guide-site.com
your-blog.info  your-credit.info

Above Telecommunications Expands the Reach of Investment Banking Corporate Access
AboveTel Non-Deal Roadshow Video Communications Service brings investors and corporate management together in the same room anytime, anywhere.

Title Insurance Protects Your Financial Investment
You purchase homeowners insurance to protect yourself financially in case something happens to your property or its contents. However homeowners insurance won't protect your financial interests if a matter arises regarding past ownership of your property.

Steripen Water Purifier - Is The Steripen Worth The Investment For Your Health?
A Steripen water purifier is the safest and fastest way to disinfect your drinking water. Don?t believe it? Read on to find out why.

Why Should You Get A Capped Mortgage?
Many people who get variable rate mortgages find that they can mix the security of a fixed rate mortgage whilst still having variable rates by getting a capped mortgage plan. If you are looking for a variable rate mortgage then you should seriously consider putting a cap on the mortgage. Here is some useful advice about whether or not you should proceed with a capped mortgage:

Dream Property Investment in Dubai
Dream Property Investment in Dubai Property Abroad is one of the dreams of many people. Property Investment seems like a nice dream but something that could never come true. This is all wrong! The potential for Property Investment is now so good, as more and more markets become available to every buyer. If you are a first time buyer and seeking that little piece of Property Abroad or you want to build up your portfolio to include greater property investment, you can do it!

Basic Information You Need To Know About Getting Home Mortgage Loan
Interested in getting a home mortgage loan soon? Here is some basic information you need to now about home mortgages. Arm yourself with these pieces of information before moving further.

Good Tips On Refinance Home Equity And Mortgage Refinance
If the words ?refinance home equity? and ?mortgage refinance? seem very strange for you, here are a few things you should find out in order to shed some light on this field.

Children's Wooden Furniture - A Great Investment
Children?s wooden furniture is a great investment in quality items for them. Since the furniture is made of a solid wood, it will stay looking nice for a very long time as well as stand up to the roughness of most any child. There are many types of children?s furniture to choose from including desks, toy chests, tables with chairs, book shelves, and the famous rocking horse.

If You Want Cheap Mortgage Protection Insurance Then Buy Independently
A lack of knowledge when it comes to the options for taking out mortgage cover leads to many homeowners paying over the odds for their protection. This is due to the fact that many do not realise they have the option of shopping around for their cover and they instead take it alongside the mortgage at the time of borrowing. If you want cheap mortgage protection then the only way to ensure you get quotes for the lowest premiums is to go to a standalone provider.

Five Key Steps to Being a Success at the Real Estate Investment Game
People love to be mystified. The arts mystify them, so they compliment the creator on his or her skill. They find science mystifying, so they don't even want to know what researchers are doing. Investment in real estate mystifies them, so they make the assumption that it's a lottery and that some people either are extremely lucky, or that they were born with a natural talent .

Bad Credit Mortgage Lender - What to Look For
If you have less than perfect credit and are looking to get approved for a mortgage loan, be careful not to make some common, costly mistakes. When dealing with sub-prime mortgage lenders or bad credit mortgage lenders, many people are taken advantage of because of their eagerness to get approved.

Mortgage Advisers And Overseas Property
The foreign property market has become an obsession with British investors in recent years and mortgage advisers have reaped the benefits While France, Spain, and Portugal have long been favourites with retirees and investors alike, new markets in Eastern Europe have emerged and tempted many Brits

Can A Bad Credit Refinance Mortgage Loan Save Your Home?
If your debt monthly payments including your mortgage installments have become unbearable and you fear you might loose your home to repossession, you might want to consider a refinance mortgage loan. Following you will learn when refinancing is the solution and what type of loan you should request.

Special Investment Advisory Update as Metanor Resources is Cleared for Gold Production
With the issuance of permits now for their Batchelor Lake gold milling facility, it is clear sailing to commence production. Now is the time to pay attention to MTO.V shares as the current valuation should make upward adjustments to reflect forward discounted future revenues of Metanor as a gold producer with a solid expandable resource base in a mining friendly region. Mining MarketWatch Journal Special Advisory Update of Metanor Resources Inc.