Prepayment Penalty Fees
Prepayment Penalty Fee is the fee that a lender may assess when a borrower repays the loan before the scheduled maturity date or when a borrower tries to record a payment transaction that is more than what is due at that point of time. This fee is charged only when the Prepayment Penalty Fees is defined in the Fee Set of the loan.
For more information on defining a Fee and a Fee Set, see the Fees Management > Define a Fee and Fees Management > Define a Fee Set section of this guide.
You can retain the pay-off fee amount set up on the lending product or override it at the contract level. For example, the pay-off fee of 100 dollars may be defined on the lending product, however, you may change this value to 20 dollars on the contract.
The prepayment penalty period determines the number of payment periods for which the prepayment penalty is applicable. IF a loan payoff occurs before the number of periods in this field have passed, a prepayment penalty is charged for the loan.
For more information on applying a prepayment penalty fee to a loan contract, see the Contract Management > Apply Fees on a Contract > Apply Prepayment Penalty Fee section of this guide.