Are cancellation/termination fees on an interest only home equity loan/line of credit legal in New Jersey?
Stephen asked:
I recently refinanced with another company and the original company charged me a $500 fee. It is clearly stated that they can in my contract, but I still question the legality of that.
JAYSON
I recently refinanced with another company and the original company charged me a $500 fee. It is clearly stated that they can in my contract, but I still question the legality of that.
JAYSON
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2 Responses to “Are cancellation/termination fees on an interest only home equity loan/line of credit legal in New Jersey?”
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CYRIL
You need to look at the paperwork that you signed, if indeed as you have stated there is an early closure fee, then there will be one for sure. Banks have a way of wording fees to get around any state laws that may exist. However, with most mortgage transactions, there will be some sort of fees associated with the closing of accounts.
CAMERON
Yes, it is legal. Companies such as Chase, for example, started this practice approximately a year and a half ago. The fee may have been avoided at the time of application (they typically will charge you a higher interest rate if you want to avoid the early termination fee). Sorry - wish I had better news for you.