3 ms·
Is it illegal to have prepay penalty, or not done out of tradition?
by anticensor 3y ago
Is it illegal to have prepay penalty, or not done out of tradition?
- aidenn0 3y agoI honestly don't know. The way many restrictions work in the US though is that legally is on a state-by-state basis, but the main driver is whether or not Fannie Mae (and similar federal entities) will underwrite the loan. That's where the 30 year maximum term, and 80% loan-to-value limits come from
- horsawlarway 3y agoAmerican mortgages are also designed to pay out disproportionately more interest up front, and much of the cost of the loan is also paid directly at closing as up front fees. Ex: closing costs for new mortgage in my area average around 5k.