Prepayment Penalties on ARMs

In the rush to get financing, many people fail to look at the fine point. One of the key clauses you need to understand is the prepayment penalty provision. Some loans don’t have any prepayment penalty, but more and more are including it. The penalty can really act as a hammer against you refinancing or even selling your home. Make sure you understand what you are getting into, particularly how long you are locked into the loan.