Hi I’m thinking of selling my home which I used to secure a loan for a investment property the bank told me I need to repay 80% of market value of investment property My loan is fixed interest only do i have to pay extra fees and charges ? Thanks
If the property is sold or refinanced before the expiry of the fixed rate period, the bank will charge you breaking costs, that can only be determined by calling them directly,it cannot be calculated .
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Assuming your capacity to pay the loan is not in question, I would expect that you would just need to reduce the loan to equity position on the investment property to 80%.
You might have to pay some penalty interest, depending how much you need to reduce the loan balance, and how long you have left on the fixed rate term.
Good luck, and don't be afraid to liaise with a broker to ensure the bank is looking at your plans properly - there may be options available that the bank hasn't considered (generally to hard too think out of the box).
Agree with Madhu's response. There will be costs involved to pay out or pay down a fixed loan early, the costs can be calculated by the lender for you. If you wanted to discuss your scenario in more detail please let me know.