Calculate prepayment penalties and estimate your interest savings
Early repayment allows you to pay off all or part of your mortgage before the scheduled term. This can generate substantial interest savings, but typically involves paying prepayment penalties (IRA in French regulations).
Prepayment penalties are capped by French law: they cannot exceed the lower of these two amounts: 3% of the remaining principal or 6 months' interest on the repaid capital.
Depending on the type of mortgage, early repayment penalties (IRA) may be reduced or fully exempted:
French law provides several situations where penalties do not apply:
Reducing the duration of your loan also results in savings on the total cost of borrower insurance.
Insurance savings = Duration reduction (in months) × Monthly insurance cost:
Example: If you reduce the duration by 24 months and your insurance costs €50/month, you will save €1,200 on insurance.
Prepayment penalties are fees that the bank may charge when you repay your loan before the scheduled term. They are regulated by French law and cannot exceed the minimum between 3% of the remaining principal and 6 months' interest on the repaid amount.
Yes, you can make a partial repayment. You will then have the choice between reducing your monthly payments (constant duration) or reducing the loan duration (constant payments). Duration reduction generally generates more interest savings.
Early repayment is generally profitable when interest savings exceed the cost of penalties. Our calculator indicates the profitability of the operation and provides a personalized recommendation.
Yes, French law provides penalty exemption in several cases: job relocation, involuntary termination of professional activity (layoff), death of borrower, retirement, category 2 or 3 disability, sale of primary residence following job relocation or divorce, and sometimes unemployment according to your contract. PTZ, Eco-PTZ, and often bridge loans are also exempt from penalties.
Penalties are calculated on the repaid amount and capped at the minimum between 3% of remaining principal and 6 months' interest. Our calculator automatically performs this calculation in compliance with French regulations.
Yes, penalties are negotiable. When taking out the loan, you can request a clause reducing or eliminating penalties. Some banks also agree to reduce them during the loan period, especially if you keep other products with them.
For a full repayment, the bank cannot refuse. However, for a partial repayment, Article L313-46 of the French Consumer Code allows the bank to refuse if the amount is less than 10% of the original loan amount. This rule does not apply to the final loan balance.
Reducing the duration keeps your monthly payments the same but shortens the repayment period: you pay less interest overall. Reducing monthly payments keeps the same duration but lowers your monthly charge. As a rule, reducing duration is more financially advantageous because you reduce the total interest cost more significantly.
An early repayment can reduce the cost of your borrower insurance. If you reduce the duration, you save on premiums for the eliminated months. If your insurance is calculated on the remaining principal, the capital reduction also lowers your premiums. Since the Lemoine Law (2022), you can also switch your insurance at any time without fees.
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Amount still to be repaid
≈ 10 years
Monthly cost of your insurance (optional)
Legal maximum: 3%
Prepayment penalties are capped at the minimum between 3% of remaining principal and 6 months of interest on the repaid amount. Certain cases allow for full exemption.
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