Early repayment

Early repayment allows the borrower to repay all or part of their mortgage before the scheduled term. In Belgium, the law limits the reinvestment indemnity (penalty) to 3 months of interest on the capital repaid early. This indemnity compensates the bank's loss of interest income. Early repayment is advantageous when rates have dropped (for refinancing) or upon a significant cash inflow (inheritance, sale of another property).