Finance
Minnesota's Open Mortgage law permits homeowners to:
ARefinance without penalty regardless of the mortgage terms
BPay off their mortgage balance in full at any time if the mortgage is more than 30 days past due
CPrepay their mortgage under certain conditions at any time without penalty if the mortgage permits✓ Correct
DTransfer their mortgage to any buyer without lender approval
Explanation
Minnesota has statutory provisions regarding mortgage prepayment. Borrowers generally have rights to prepay their mortgages subject to any agreed-upon prepayment penalty terms.
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Key Terms to Know
Short Sale
A sale of real property where the sale proceeds are less than the outstanding mortgage balance, requiring lender approval.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
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