Mortgage Prepayment Penalties in Wis

[TillyLou]

What is the name of your state? Wisconsin

I just closed on a house that I owned for just under 2 years. I have credit challenges and had a mortage that had (what I thought was) a penalty for early refinancing. I didn't realize I'd be penalized for selling the house.

The mortgage company took about $4800 more than the payoff and listed it as "prepayment penalty". My realtor (not a lawyer) told me that prepayment penalties are illegal in Wisconsin.

I called the office of our AG (Peg Lautenschlager) and was routed to some banking regulation board that hasn't returned my calls in 3 days.

Can any of you learned folks point me to a place where I can find out if I have a chance of getting any of that money back?

Thanks in advance,

Tilly Lou

[efflandt]

Maybe not a direct law quote, but see right column of this UW publication [URL=http://www.uwex.edu/ces/cty/clark/flp/documents/HomeownersBeware_000.pdf]Homeowners Beware[/URL] under "Hidden Loan Terms: Balloon Payments, Prepayment Penalties".

It does not say what the time limit was before, but as of early 2005 prepayment penalties were to be limited to first 3 years of loan (and you are less than that).

[TillyLou]

Wow, a perfect reply (even though it was bad news). I looked for an hour to find something succinct like that!

Thanks EFF,

Tilly