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Are pre-payment penalties common with today's mortgages?
I'm planning to buy my first house in Texas in the next year and trying to determine how conservative I should be with my down payment. My worst case scenario includes paying out of pocket closing costs and appliances (plus maintaining an emergency fund and paying the initial costs of moving). Since my down payment will be less than 20% and I believe PPI will apply, I'm thinking of just putting 10% down. I'd rather underestimate and make additional payments after a few months - but that only benefits me if pre-payment penalties do not apply to the mortgage. Are they common?
4 Answers
- A HunchLv 77 years agoFavorite Answer
I have not been offered one with any of my recent loans. I don't think most are.
But it's a question to ask when talking with your mortgage broker.
As long as you don't have any usual bills, you can afford easily afford 2.5X your annual income with a home. Don't go over 3X.
- Anonymous7 years ago
A few applicants for financial loans were underneath the impression which payment protection insurance coverage was section of the financial loan itself whilst other people were resulted in believe it might increase their possibility of obtaining credit score.
A lot of people were actually given the plan even though they were doing not be eligible for this. It was equally correct for those obtaining loan payment protection insurance coverage along with the regular policies sold along with loans and bank cards.
This particular saw individuals who were jobless, outdated or in a lot of the time study during the time of their own application, like provided the. If they happen to have attempted to claim on the policy chances are they might have been not able to do this – which means they were spending money on something these were not able to utilize.
- ?Lv 77 years ago
NEVER sign a contract with prepayment penalties.
If it's in the contract, just TELL THEM that you will take your business elsewhere unless they remove it.
Pretend you're a grownup and grow some damn balls.
- 7 years ago
yeah. You need to read up on pre-payment penalties, it can be pretty crazy. get an hour of an attorney's time and then u will for sure know the laws.
