Early repayment penalty

If a loan is repaid before the end of the fixed interest period, borrowers must pay an early repayment penalty. Sometimes it is also referred to as prepayment interest. This is a kind of compensation for lost interest and buffers the loss for the bank.

However, you can declare these costs as income-related expenses on your tax return — if you are a landlord.

Prepayment penalty

If you want to repay your loan for your property early, you usually owe the bank a so-called prepayment penalty. Here we explain what it is and how you can avoid it.

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