Minnesota prepayment penalty rules

Minnesota permits prepayment penalties on prime loans but restricts them: no penalty for partial prepayment, for prepayment upon sale of the property, or for prepayment more than 42 months after loan date; the penalty is capped at the lesser of 2% of the unpaid principal balance or 60 days' interest. Subprime loans (as defined) are generally prohibited from having prepayment penalties, unless the loan amount exceeds the conforming loan size limit set by Fannie Mae.