Legal Question in Real Estate Law in New Jersey

prepayment of mortgage penalty

Hi. We bought a house in June 2001. THe mortgage has a 24 month prepayment penalty clause. My fiance lost his job and we are having trouble paying the bills. They mortgage company calls everyday because we are always late, even though we havent been over 30 yet. Who would we contact to ask them to excuse us from the prepayment penalty due to hardship? We would like to sell the house but we would need the profits to move. Do you know if mortgage companies will generally do this? Thanks for your help.


Asked on 3/12/02, 1:16 am

2 Answers from Attorneys
Robert Gleaner Robert A. Gleaner, P.C.

Re: prepayment of mortgage penalty

There is no general rule. Different lenders have different standards. I would certainly suggest that you immediately retain an attorney to assist you with this. He/she would negotiate with your company for you and attempt to reach an amicable arrangement. I will be happy to assist you. However, you need to call me at 856-546-8010. Good luck! Rob Gleaner

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Answered on 3/12/02, 7:33 am
Savyon Grant Law Office of Savy Grant

Re: prepayment of mortgage penalty

I am an experienced real estate attorney in the state of NJ. I disagree with the other attorney. In the State of NJ, prepayment penalties are not allowed. If it is a Federally chartered bank, than it is allowed. Federal chartered banks can override State law. What you need to do, is have an experienced real estate attorney review the mortgage documents and try to work out a deal with the bank.

Please call my office and I will be very happy to assist you with this.

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Answered on 3/12/02, 12:49 pm


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