Journal Article

Prepayment penalties on subprime mortgages


Abstract: As a result of the subprime mortgage mess, prepayment penalties are under close scrutiny. While these, like other kinds of contract terms, can be abused, there are good reasons for why they exist. In principle, they serve to extend credit to a greater number of borrowers.

Keywords: Mortgage loans; Prepayment of debts;

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Bibliographic Information

Provider: Federal Reserve Bank of Cleveland

Part of Series: Economic Commentary

Publication Date: 2007

Issue: Sep

Order Number: 1