PLease I need your help on a loan question:):):):)

If you pay out or refinance within a specified period early,  (usually 3 – 5 years) you may be stung by having to pay a hefty fee.

DEFs kick in when you payout a loan in full. So if you stay with the same lender and just pay down a loan, but not pay out completely, then there would usually not be any DEF. However if your loan is fixed, there may be limits on how much extra you can pay in one year – over this amount the may charge you.

Some lenders have huge DEFs (up to 4% of loan amount), others may be much lower such as 1% in r 1, 0.8% in yr 2 etc, others just a flat fee and some don't even have them.

If you are definately paying out and selling in a year or two, then view your loan as a means to an end, and you will need to look at the app fee, interest rate, and the deferrered charges, and discharge fees. Taking advantage of deals with lower or zero application fees, making the most of specials is a good place to start. Any loan that has a 1.5 or 2.5 % fee as a 'def' is going to cost you, but weigh that up against how much you will save on interest during the loan term if it is a cheaper interest rate. Most with higher fees want you to stay for a few years at least, so you get offered a lower rate to attract you, and the DEF fees to keep you. A lot will depend on your loan size, but it sounds like you would possibly be better off getting a deal with a flat rate discharge fee (ie regardless of loan size) but also be careful – because others also have hefty loan discharge fees as well. For example, some banks have a flat charge of $750 regadless of now many years the loan is for. Most will have some sort of fees for payout in the first year, but after that will be reduced or not apply any early fee . Check first, and do the sums. All the best with your project – sounds good.