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Premature repayment of a mortgage loan

Early repayment of a mortgage loan

Early repayment of a mortgage loan

With early repayment of a mortgage loan, it can sometimes be a bit more complicated. What should I look for in the early repayment of a mortgage loan? In all these cases, there is no obligation to terminate a mortgage loan early. It also offers the possibility of early loan repayment.

Guide to German-speaking and European banking law

Guide to German-speaking and European banking law

The 110 renowned authors from the academic world, who often act as lawyers, mediators and mediators or consultants, as well as scientific practitioners from the legal and legal professions, guarantee a balanced interpretation of the law and a reliable and Timely presentation of the individual sections in condensed and condensed form, in order to allow the educator a practical and expert introduction within shorter periods of time. The editors of

International and international banking and financial market law

International and international banking and financial market law

The practice-oriented work systemically explains the entire area of ​​banking law in Germany on the basis of current legal developments. In addition, the development of European and banking law of European countries is presented in the form of country studies. Increasingly, the focus is also on institutions and phenomena as well as areas of law whose relevance has become increasingly clear in recent years as a result of the financial market crisis – for example rating or scoring or data security and banking.

The first part deals with the main features of bank contracts, loans and collateral, as well as accounts and payment transactions.

Decision of the SWA

Decision of the SWA

If the client of a house bank in case of non-acceptance of the mortgage loan with their early repayment or cancellation of a loan commitment or recovery of the loan as a consequence of certain events set in advance amounts represent the customer, it works – as far as no compensation is available is – to the remuneration for after 4 No. 8 ZStG 1951 (UStG 1967) tax exemptions.

By assigning mortgage and municipal loans as a Ponser bank, the company relinquishes the applicant’s mortgage and municipal loans to the company. When it comes to mortgage credit, it first concludes with the borrower a loan contract formula, which contains a promise of credit and makes the borrower to take the loan obligatory. For the time until the loan payment, the client has to pay commission interest.

Loan preliminary agreements then contains the following provision analogously. (Clause 3 of the “General Terms and Conditions for Repayment Mortgages”, based on the Claimant): If the loan becomes due before the expiry of the stated minimum execution period, then in the case of repayment for the period from maturity to expiry, the minimum execution period originally intended a sum of money of 1/2 v. H. – but not more than 2 1/2 years H. – of the amount of credit originally designated as prepayment early – the early repayment early in arrears.

The applicant, which taxed its transactions in accordance with general principles, presented the position that amounts were indicated as compensation directly related to the lending business and was either payment for a loan within the meaning of Section 4 (8) of the VAT Law (UStG 1951) or lump sum Compensation for non-performance resulting in a positive breach of contract.

The applicant’s complaint has failed. The applicant further stated in the complaint that the amounts marked as compensation do not count towards the VAT base. He abrogated the adjustment decisions for 1961 to 1966 and otherwise covered the VAT for 1966 and 1967 at 20,876.95 dm and 14,780, respectively.

In his view, if the loan has not yet been disbursed, the sums will receive a loan commitment or, if the loan has already been granted, a payment to adjust it to the minimum maturity date. From an economic point of view, all bank customer payments represent the remuneration for the holistic process of granting credit, even if the contractual relationships lead to premature termination.

The amounts designated as compensation do not meet the economic goal of self-employment. These could not be left as independent, so that a payment for the termination of the loan agreements was to be seen in them. In the revision, the tax office complains (complains) the 1 No. 1 and 4 No. 8 STG 1951. According to its opinion, both so-called compensation represent a payment for the early discharge of the contractual relationship ……

It is therefore not a remuneration for a loan, but in contradiction for the termination of for. With longer lasting contractual relationships, it is recognized that there is a taxable gain if one of the affected parties is released early against payment of his contractual obligations. This does not only apply to the hire of employment contracts, but also to contracts for or lending or creditworthiness.

The applicant requests that the revision be rejected. As far as the claims for damages were concerned, the payment transactions of the credit institutions established here were remunerations for allowances of the plaintiff in connection with a grant of credit (1 No. 1, 4 No. 8 UmwG 1951). If a Borrower receives the repayment from Plaintiff after receipt of the early approval loan amount, he must pay the amount of money indicated by the parties as prepayment penalty (a).

If the loan customer already refuses to accept the agreed loan, he has to pay the so-called non-acceptance fee of 1 per cent. H. the intended loan amount specified in no. 17 of the credit preliminary agreement (b). Finally, if it comes within its sphere of influence to another event affecting the performance of the contract, with the consequence that plaintiff recalls the loan commitment before issuing the loan and can reclaim the loan after issuing the loan, the borrower has the so-called non-acceptance compensation.

in addition to the payment of the prepayment penalty (c). a) amount. If the borrower and plaintiff agree on the early repayment of a loan that has already been disbursed, it will be the amicable reorganization of the original loan relationship, which will reduce the minimum loan period. The reduction of the minimum operating time results in an adjustment of the paid up to then, on the basis of the initially fixed operating time of the calculated payment, in order to enable the claimant with no or little reduced own costs despite the shorter operating time nor a profit.

The link between the adjusted remuneration and the granting of credit must be ensured. An additional addition to the original granting of credit which enters into the applicant’s execution is not linked to the conversion of the contract. The sums referred to by the persons concerned as prepayment penalties are therefore not in these cases a payment for a premature discharge of credit, but as the negotiated interest payment for a 4-point STG 1951 duty-free credit. b) If the customer already refuses to accept the credit, the applicant’s examination until the time of the refusal to grant credit (examination of the credit documents, estimation of the loanable items, acquisition of funds) has proved to be pointless.

In order nevertheless to receive a sufficient remuneration for the activity which has already been carried out, the plaintiff is required to make use of the allowances set out in point 14 of the loan sub-contract. The allowances already paid by the plaintiff are therefore to be accounted for. 

The tax exemption of these advantages is not in the way, as the intended distribution of the loan did not take place. In spite of the failure to achieve the main achievements, the achievements will maintain their actual lending as a preparatory and promotional feature, without being given the economic added value of self-employed persons after the failure to grant credit.

In doing so, they also remained for self-esteemed achievements, which were put on a lending, because they should enable indispensable conditions for the distribution of a mortgage loan. Thus, they are also subject only to the exemption provision of  4 No. 8 STG 1951. c) If, in the event of non-acceptance of the loan, before or after its sub-distribution under b), an incident occurs which causes the loan to be processed under contractual conditions ? j in jeopardy of lending or the cancellation of the credit or loan agreement by the claimant or the cancellation of the credit by the claimant or the termination agreement by the claimant or the loan agreement or the cancellation of the credit by the claimant or the cancellation of the loan by the credit relationship or processing of credit by means of credit or cancellation of credit by means of credit relationship or maintenance of processing of credit by credit relationship is omitted?

In the case of a recovery of the loan, these are, by reason of this, released in advance, and if they are not actually compensation for damages anyway, they are also paid by the plaintiff for – tax-free benefits. Insofar as these allowances are at all attained by Applicant, it can only be the other provision already made by plaintiff until the loan has been withdrawn or until the loan has been repaid.

These existed either in leaving the main town for use, and thus in the current granting of credit, or else in the activities already marked for b). Both fall under the exemption clause of 4 No. 8 of the Value Added Tax Act 1951, according to which for established in advance of the granting of credit and thus necessarily related achievements can refer to the justification given under b).

Already now the joint opinion of the tax office, which frees the borrower Plaintiff against payment of his contractual obligations and thus provides an independent other achievement, because plaintiff in the here due to incurring contractual disturbances writing off cases unilaterally from the contract. Therefore, since the disbursements of the borrowers designated as compensation are only paid for exempted services by Plaintiff, the audit of the tax office was refused.