Early repayment (předčasné splacení)

A family sells its flat after 5 years, with about CZK 3,543,000 left to repay and 2 years remaining on a seven-year fixation. Because more than 24 months have passed since the loan agreement was signed, repaying from the sale proceeds is free. Had they refinanced with another bank instead of selling, the old bank could charge up to 0.5 %, i.e. no more than CZK 17,715, and never more than the interest it actually loses.

It is also free on a variable rate, on the death or serious illness of the borrower or spouse if it substantially reduces the ability to repay, and on the settlement of joint marital property after a divorce, again once 24 months have passed since the contract was signed (§ 117(3)).

Get the bank to state in writing the balance and any fee as of a specific date. For a sale, provide the purchase agreement; for illness, a medical report. Paying off the loan is not the last step: ask for the confirmation of repayment (kvitance) and file an application to delete the lien, which costs CZK 2,000. Old rules can mislead you, because fees are no longer calculated as they were before September 2024 and the new rules apply to older contracts too.

An extra repayment is one form of early repayment: it reduces the debt, but the loan carries on. Refinancing is early repayment with money from another bank. An early repayment fee is what the bank may ask for when you repay outside the statutory exceptions; it may not charge one in the anniversary window or at the end of a fixation.