State rules / Prepayment Penalty Rules

New York prepayment penalty rules

Prepayment penalties are permitted only during the first year after loan origination, and only if expressly provided in the loan contract and not prohibited by Banking Law §§6-l or 6-m. After one year, no prepayment penalty may be imposed. The right to prepay must be stated in the loan instrument.

Prepayment Penalty Rules in other states

Researched and verified against primary sources by AI, with the controlling citation above. Not human-reviewed and not legal advice — confirm against the cited source before relying on it. Last updated July 6, 2026.

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