24 CFR § 241.585 - Prepayment privileges and prepayment charge.

---
identifier: "/us/cfr/t24/s241.585"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "24 CFR § 241.585 - Prepayment privileges and prepayment charge."
title_number: 24
title_name: "Housing and Urban Development"
section_number: "241.585"
section_name: "Prepayment privileges and prepayment charge."
chapter_name: "OFFICE OF ASSISTANT SECRETARY FOR HOUSING—FEDERAL HOUSING COMMISSIONER, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT"
subchapter_number: "B"
subchapter_name: "MORTGAGE AND LOAN INSURANCE PROGRAMS UNDER NATIONAL HOUSING ACT AND OTHER AUTHORITIES"
part_number: "241"
part_name: "SUPPLEMENTARY FINANCING FOR INSURED PROJECT MORTGAGES"
positive_law: false
currency: "2026-03-24"
last_updated: "2026-03-24"
format_version: "1.1.0"
generator: "[email protected]"
authority: "12 U.S.C. 1715b, 1715z-6, and 1735d; 42 U.S.C. 3535(d)."
regulatory_source: "36 FR 24653, Dec. 22, 1971, unless otherwise noted."
cfr_part: "241"
---


# 241.585 Prepayment privileges and prepayment charge.

The security instrument shall contain a provision permitting prepayment of the loan in whole or in part upon any interest payment date after giving to the lender 30 days advance written notice and it may contain a provision, with the approval of the Commissioner, for a reasonable charge in the event of prepayment. The borrower shall be permitted to prepay up to 15 percent of the original principal amount of the loan in any one calendar year without an additional charge. A provision for a charge in the event of prepayment may not be included in a loan of $200,000 or less.