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Loan Prepayment Penalty & Adjustment

Effective January 1, 2023, no penalties may be imposed on prepayment or refinancing of a residential mortgage loan of less than $107,633.

Revised Code 1343.011(C)(2)(a), effective as of January 1, 2007, states that no penalty may be charged for the prepayment or refinancing of a residential mortgage obligation of less than $75,000 that is made or arranged by a mortgage broker, loan officer, or non-bank mortgage lender, as those terms are defined in section 1345.01 of the Revised Code, and that is secured by a mortgage on a borrower’s real estate that is a first lien on the real estate.

Further, Revised Code 1343.011(C)(2)(b) states that the loan amount limit is to be adjusted annually on January 1st by the annual percentage change in the Consumer Price Index (CPI) for all urban consumers, Midwest Region, all items, the Consumer Price Index as reported on June 1st of the year preceding the adjustment. During the period of June 1, 2021 to June 1, 2022 the CPI increased by 9.5%.