When buying a home is almost always intended to use the property permanently or until the end of life. But sometimes things just happen differently in life. For example, a new job or divorce may result in the property being sold. But sometimes this is easier said than done, especially if there is still a real estate loan.
Is an early exit possible?
Affected parties should first check whether there is the possibility to withdraw from the financing in a timely manner. This is not self-evident, especially for loans with fixed interest rates – a fixed financing period has not been agreed with the bank without reason.
If necessary, an exit is possible, for example if there is a very valid reason. However, the range of these reasons is not particularly large, at least if no supplementary contractual arrangements have been made. There is no way around a conversation with the bank.
Even if an exit is possible, it is not necessarily free. In such cases, the banks almost always charge so-called prepayment penalties. It is intended to compensate for the interest loss that arises as a result of the premature exit. The legal situation entitles the banks to do so. The longer the remaining term and the better the interest rate development since borrowing (in the sense of lower market interest rates), the higher the compensation payment.
Incidentally, customers have a right to know what the amount of the prepayment penalty amounts to. If the bank is not interested in a calculation, a reference to court rulings of the past years can help.
When concluding the loan agreement, builders and buyers can ensure that an early exit from financing is effortless and free of charge. Several banks offer corresponding hedging instruments. Hardship cases are then defined that define in detail when an exit is possible. The agreement of hardship cases usually entails costs, but these are usually considered manageable.