Transactions in the real estate market have increased since the withdrawal of the hot tax, and buyers who have purchased properties in recent years may sell their properties early because they are worried that property prices will fall. They will wait until property prices fall again before buying again. After all, owners no longer need to wait for the "hot tax" tax. Selling the property after loosening restrictions and exiting the market early are risk management practices. However, the number of these resale cases is not too high, and one of the reasons may be related to the penalty period.
There are not many resale cases. One of the reasons may be that property prices have accumulated a lot of decline and the owners have suffered heavy losses, or the owners have just moved into the unit and are unwilling to move again. However, it is also related to the penalty period. There is no uniform standard for banks to set penalty interest periods. The length of the penalty period for mortgage plans provided by different banks is different. Generally, the penalty period is one to three years, starting from the date when the money is withdrawn. For example, if Mr. Chen withdraws the loan on May 1, 2024, the mortgage penalty period will be three years. He will have to pay off the loan early after May 1, 2027 to avoid the bank's penalty period.
The penalty amount is calculated based on the year
Regarding the penalty period, the mortgage plans of various banks are also different. Applicants should remember to pay attention to the details when applying for a mortgage. Generally speaking, the penalties during the penalty period will decrease with the term. The penalty for early repayment is the heaviest in the first year; while the penalties for the second and third years are relatively mild.
For example, some large banks have a three-year penalty period. If you repay early in the first year, the applicant will need to pay up to the mortgage amount of 3%, or 50,000 yuan. Plus cash rebate; in the second year, the mortgage amount will be 2%, or 20,000 yuan plus cash rebate; in the third year, the mortgage amount will be 1%, or 10,000 yuan. The penalty period penalties for small banks are generally more lenient for large banks. For some banks, in the first year of the penalty period, you only need to pay the mortgage amount of 1%; in the second year, you only need to pay the cash rebate amount. It is worth noting that if the applicant applies for a mortgage through a mortgage referral company and needs to pay a cash rebate to the bank for repayment during the penalty period, generally only the bank's cash rebate is required for the cash rebate amount. Just give it to the bank. There is no need to pay the rebate paid by the mortgage referral company.
If the applicant intends to repay the loan early, before applying for a mortgage, he should understand the details of the penalty periods of different banks and compare them to find the mortgage plan that best suits him.
Applicants are not required to remortgage immediately after receiving the rebate.
Some readers may wonder, isn’t it good for the bank for borrowers to repay their loans early? Why do banks seem to “not like” applicants to pay off their loans early? In fact, some banks will include a penalty interest period in the mortgage terms in order to prevent mortgage applicants from "premature" repayments. Firstly, it is used to protect the bank's income; secondly, in the past, many banks have provided generous cash rebates to applicants for primary mortgages or remortgages. In order to prevent applicants from immediately remortgaging to other banks after receiving the rebates, Penalty periods can come into play for this.