Early repayment of a mortgage: capped compensation and cases of exemption

You can repay part or all of your mortgage early (service-public.gouv.fr). Your contract may include early repayment penalties, but their amount is capped: they cannot exceed six months' interest on the repaid capital at the average loan rate, nor 3% of the outstanding capital before repayment. They are not due when the repayment follows the sale of the property for one of the following reasons: change of workplace, forced cessation of activity, or death (for contracts concluded after July 1, 1999, according to economie.gouv.fr and ANIL).

This page describes these rules based on the official sources listed at the end of the page. It does not address bridging loans, which are not mentioned on the service-public.gouv.fr website, nor does it specify the fees for releasing the mortgage. It does not specify a notice period: the pages consulted do not mention one, which means it says nothing about what your contract stipulates.

Reimbursing in full or in part: the principle

Repayment can be total, for example during a loan consolidation, or partial, for example after an inheritance (economie.gouv.fr, page written on 30/09/2025). The Bank of France states that the bank cannot refuse early repayment.

The threshold of 10 %. Service-public.gouv.fr (information verified on 16/09/2026) states: "Your loan agreement may require that the amount of the early repayment be more than 10% of the initial loan amount. This minimum does not apply if you repay the outstanding balance of your loan.".

The approach. Contact your lender, preferably in writing (economie.gouv.fr). For offers from July 2016 onwards, the lender must inform you, free of charge and without delay, of the repayment consequences, either in writing or on another durable medium (service-public.gouv.fr). For earlier offers, the information sheet states that they will send the figures as soon as possible and may charge for this breakdown. Economie.gouv.fr states that if the loan agreement was concluded after July 1, 2016, this cost estimate is free.

A tip from the official information sheet. Making the early repayment payment coincide with the monthly payment avoids interim interest.

The cap on compensation

Service-public.gouv.fr states: "When these allowances are due, their amount cannot exceed" two amounts:

The Bank of France gives the same two limits: the compensation "must not exceed 6 months' interest on the repaid capital, without exceeding 3% of the outstanding capital." Economie.gouv.fr presents these limits for a fixed-rate loan and states "without exceeding 3% of the outstanding capital before repayment." The compensation therefore cannot exceed either limit: the example below uses the lower of the two.

Variable rate loan. Service-public.gouv.fr states that, in this case, compensation may be increased by compensatory interest. The information sheet does not specify the amount of this increase.

When compensation is not due

Service-public.gouv.fr states that these compensations "are not due when the early repayment follows the sale of your property", in three cases:

• a change of your workplace or that of your spouse; ;
• a forced cessation of your professional activity (dismissal in particular) or that of your spouse; ;
• a death, yours or that of your spouse.

Economie.gouv.fr and ANIL add that this exemption applies to contracts concluded after July 1, 1999. The service-public.gouv.fr fact sheet does not mention this date: if your contract is old, the rule should be checked in your contract and with your bank.

Negotiate before signing

According to economie.gouv.fr, early repayment terms can be negotiated before signing the loan agreement. Penalties can be reduced or waived, generally after a minimum repayment period. Therefore, this clause is crucial when reviewing the offer before signing. The FISE (Further Information Sheet), provided with the offer, summarizes the early repayment terms (economie.gouv.fr).

After a partial refund

The repayment schedule has been modified. Economie.gouv.fr indicates that you can choose between two options: keep the same monthly payments, which reduces the duration and total cost of the loan, or reduce the monthly payments.

Early repayment of a loan: a numerical example (fictitious profile)

The amounts, average rate, and outstanding principal are assumptions based on the profile. The calculation of 6 months of interest is simplified: principal repaid multiplied by the average rate, divided by two.

Situation. Amélie borrowed €220,000 several years ago. She still owes €180,000. The average interest rate on her loan is 3.2%. She is hesitating between paying off the loan and repaying €40,000 after receiving an inheritance.

Issue. What is the maximum compensation that could be claimed from him in each case? Would a partial reimbursement of €20,000 be possible?

Strategy. Calculate the two ceilings for each hypothesis and compare the amount reimbursed to the threshold of 10 % of the initial amount.

Result.

The threshold for the initial amount is €22,000. A partial refund of €20,000 falls below this threshold and may be excluded by the contract. A refund of €40,000 exceeds this threshold. The remaining balance is not subject to this minimum.

If Amélie repays her loan after selling her home following a change of workplace, and if her contract was signed after July 1, 1999 (hypothetical), no compensation would be due, subject to the terms of her contract. This scenario is fictitious. The actual compensation due depends on your contract.

Early repayment of a loan: what changes depending on your situation

• The date of your contract : the exemption rules mentioned apply to contracts concluded after July 1, 1999, free information applies to contracts concluded after July 1, 2016.
• The type of rate : a variable rate loan may give rise to compensatory interest.
• The reason for the refund : a sale linked to a change of workplace, a forced cessation of activity or a death excludes the compensation.
• The amount refunded compared to 10 % of the initial amount.
• What your contract stipulates, which may be stricter than the general rules.

The rule depends on your situation. No results are guaranteed.