Finance
A Colorado buyer who is told by a lender that the loan has a 'prepayment penalty' should be aware that:
AA. They will earn a bonus for paying off the loan early
BB. They may be charged a fee for paying off the loan before a specified date, which could affect refinancing or sale decisions✓ Correct
CC. Prepayment penalties are illegal in Colorado
DD. The penalty applies only if they miss a payment
Explanation
A prepayment penalty is a fee charged by some lenders if the borrower pays off the loan before a specified period. It can affect a borrower's ability to refinance or sell without additional cost.
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