| Avoiding a Pre-payment Penalty - Pre-payment penalties can add thousands to payoff your mortgage. The best way to avoid a pre-payment penalty is to not have one in the first place. Lenders will often let you buy out of the penalty or will charge you a higher interest rate to waive the pre-payment penalty. You should always be aware if the loan you are getting into has a prepayment penalty. Unfortunately, there are some unscrupulous lenders out there that will hide the prepayment penalty from you, and you may not find out until after you sign the mortgage documents. You should ALWAYS ask your lender whether or not your loan has a prepayment penalty, and ask to review the documents one day before closing so you have time to read them thoroughly. |
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