Repaying a home loan early: what may the bank charge?

For a loan within Bulgaria’s Consumer Immovable Property Credit Act, the borrower may repay all or part of the debt early. The amount payable is not determined merely by a charge being labelled a fee in the bank’s tariff.

When compensation is permitted

Article 41 provides for fair, objectively justified compensation for directly related costs up to 1% of the prepaid amount where repayment occurs before twelve monthly instalments have been paid following drawdown. After those instalments have been paid, the lender has no right to early-repayment compensation or a penalty.

The Act also contains an exception for a proven greater loss; it does not make an arbitrary tariff rate payable and must be read with the other statutory restrictions, including the fixed-interest regime. Check actual payments, contract terms and the basis of the demand rather than merely whether a calendar year has passed.

Request a calculation for a specific date

The consumer is entitled to reduction of total credit costs by interest and other costs for the remaining contractual period under the statutory regime. This does not automatically mean reimbursement of every one-off cost already incurred. Separate remaining principal, interest accrued to repayment, any compensation and other independent charges.

For partial repayment, obtain written confirmation of the revised schedule and the contractually available effect on term or instalments. For full repayment, arranging mortgage-cancellation documents is a separate step. Consumer-credit rules do not automatically extend to a company loan.