Prepayment clause

Prepayment Clause
Definition: Clause in a contract giving the borrower the right to pay a loan off prior to its due date.

Prepayment Clause
A clause in a mortgage permitting the mortgagor to pay all or part of the unpaid balance before it becomes due, thereby saving the interest or clearing the way for a new mortgage.

Prepayment Clause
A provision in a loan agreement that stipulates the amount of principal a borrower can prepay ahead of schedule without penalty as well as the prepayment penalty for larger prepayments.

Prepayment Clause:
A clause in a mortgage allowing the mortgagor to pay off part or all of the unpaid debt before it becomes due.
Prepayment Penalty: ...

If your loan agreement doesn't have a prepayment clause, which excludes a fee for early termination, the penalty may apply. Many states prohibit prepayment fees, and they're not allowed on any mortgage loans purchased by Fannie Mae or Freddie Mac.

A prepayment clause in a mortgage gives the borrower the option of retiring the mortgage indebtedness without penalty.
making extra payments toward an installment loan, or paying the outstanding balance in full.

Prepayment Penalty: On a loan without a prepayment clause, the fee a borrower pays for repaying all or part of the loan before it is due.
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Qualified Impairment Insurance (insurance term)
Waiver of Premium for Payer Benefit (insurance term)
Waiver of Tax Lien
Waiver of Exemption (in banking)
Prepayment Clause (business term)
Disability Clause (insurance term) ...

See also: Prepayment, Prepayment penalty, Expense, Banks, Saving