My fiance is all set to come to Texas from England on April 25th. We have a buyer for her house (assuming the chain doesn't fall through!) but there is a pre-payment penalty on her current mortage if you pay it off in less than 5 years (she's three years into it). Has anyone had to deal with this and is there any way out of that pre-payment penalty?

Thanks,

Matt

I don't think there is any way out of it.
I sold my house in the same circumstances earlier this year, I think I ended up paying around £4,000 as an early settlement fee. It was less than 3 years for me too. Apparantly it was in the terms at the start of the mortgage and had to be paid, no getting out of it.

Thanks. I've talked with a guy at my mom's real estate company who is from England, and he said there is a way out of it and he's trying to find out how...I'll post it if I get any answers.

Will be interested to find out if you can, my lawyer told me there was no way of getting out of it. Too late for me now, it's all paid but will be interested if you get a result.

Yea I'm not expecting any miracles either since it is a contractual obligation, but I'll at least try....

Normally the early repayment penalty is because you got a cash back, or a reduced interest rate for a fixed period or some other monetary incentive when you took out the mortgage. The mortgage agreement will say what the penalty is and how it is calculated. The bank or building society can waive the penalty but it is very rare they do.