Prepayment Rights: Difference between revisions
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== Summary of the law== | == Summary of the law== | ||
[[File:Consumer_Law_and_Debt_-_Prepayment_Rights.jpg|thumb|275px|right| link=| <span style="font-size:50%;">Image via www.istockphoto.com</span>]] | |||
In common law, parties can set out a variety of terms in a credit agreement. One important term is whether the borrower is allowed to pay off or pay down the obligation earlier than when the periodic payments (for example, the monthly payments) are due. This is called the right of prepayment. | In common law, parties can set out a variety of terms in a credit agreement. One important term is whether the borrower is allowed to pay off or pay down the obligation earlier than when the periodic payments (for example, the monthly payments) are due. This is called the right of prepayment. | ||
