Mortgage Prepayment Penalty 2027 Calculator

Calculate mortgage prepayment penalty 2027 — typically 1-5% of principal balance, declines yearly. QM loans banned penalties post-2014. Non-QM still can.

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Dodd-Frank Restrictions

Most consumer mortgages post-2014 cannot have prepayment penalty (Qualified Mortgage rule). Non-QM loans (jumbo, investment, bank statement) still can.

Common Penalty Structures

Hard prepayment: penalty even partial. Soft prepayment: only if refi or sale. Step-down: 5/4/3/2/1% by year. Yield maintenance: complex math on commercial.

When You'd See One

Investment property loans, second homes, bank-statement loans (self-employed), jumbo loans, hard-money loans. Always read disclosure carefully.

How to Avoid

Refuse to sign offers with prepayment penalty. Negotiate to remove. Increase rate slightly to avoid. Worth 0.25-0.5% rate bump to skip penalty.

Source: cfpb.gov Qualified Mortgage rule, dodd-frank prepayment penalty rules. Last updated: May 2026.