Early repayment charge, (Ending your mortgage) You may be charged this if you repay your mortgage in full before the mortgage term ends. If you change your payment date from the end of one month to the beginning of the next month, you may be required to make two payments within a relatively short timescale. So what are early repayment charges? We'll add the interest for each month to what you owe at the end of the last day of that month. the ERC wasn't made clear to them when they took the mortgage out. Or, we can set up your Direct Debit over the phone and we'll write to you to confirm your Direct Debit Instruction. Equity release is a way for senior homeowners to borrow against their residential property and not have to make monthly repayments. Values are based on a 135000 repayment mortgage loan and a 150000. It gives you important details about your mortgage including how much you owe, what interest rates you pay, how much interest we've charged and the payments you've made each month. Around nine years ago, I took out a 135,000 mortgage. When you pay down your mortgage, youre effectively locking in a return on your investment roughly equal to the loans interest rate. If the mortgage is paid off during year 2, then the penalty is 1% of the outstanding principal balance. Nick has been writing professionally on money and business topics for over 15 years, and has previously written for leading accountancy firms PKF and BDO. Sometimes the percentage reduces the longer youve had your deal, which is often the case for big high-street lenders like NatWest, Nationwide, Halifax, HSBC and Lloyds Bank. To set up an additional payment by standing order. If you're still in the Early Repayment Charge period on your mortgage a. When the total monthly payment comes in, we split it to give each sub account the amount it needs. Written confirmation may be required. Is it worth paying early repayment charge? If you are moving home, you may be able to avoid the ERC by mortgage porting. An ERC is an Early Repayment Charge, which is FSA mandated terminology for a charge made when you redeem your mortgage during a mortgage's ERC period. If you're thinking about changing your mortgage term we may ask for confirmation of your income, particularly if the mortgage term extends beyond retirement age. Your reference number should be your 14 digit mortgage account number followed by 02. If an error is made in the payment of your Direct Debit, by Halifax a division of Bank of Scotland plc or your bank or building society, you are entitled to a full and immediate refund of the amount paid from your bank or building society. If you do need a duplicate printed mortgage statement you can request one in your internet banking. Find out how to register. This will be split between the sub-accounts in line with your current mortgage instruction as follows: You make a 500 additional payment and want the whole additional payment to reduce your balance on sub-account 02. Please note we can only take debit card payments from customers named on the mortgage account. In most cases, the lowest cost option is simply to wait until the early repayment period expires, even if this means spending a short time on an SVR mortgage. Lenders may use different early repayment charge structures, but most fit into a fixed rate or variable rate structure. There are a number of reasons your mortgage balance may increase including: If your mortgage balance has decreased, this may be due to previous overpayments made. MoneyNerd Limited is a free to use service, however we may receive a commission, at no cost to you, if you complete a loan, enter into a mortgage, remortgage or equity release agreement. I thought the penalty would be reducing pro . Halifax is introducing a new Rate Guard feature to all its core tracker. When mortgage rates drop significantly, it might be worth switching to a new mortgage deal at a lower interest rate. Save time and contact all housebuilders at once. For Online Banking: log on to your account. halifax early repayment charge waived. If you're thinking about changing your repayment method to a repayment mortgage or to interest only, you'll need to call us to discuss your situation. No repayment of the principal amount of the Senior Notes or payment of interest on the Senior Notes shall become due and payable after the exercise of any U.K. bail-in power by the relevant U.K. resolution authority unless, at the time that such repayment or payment, respectively, is scheduled to become due, such repayment or payment would be . You need to speak to the mortgage lenders redemption/repayment department and get their written authority that they will agree to waive the early repayment charge. So the longer you sit tight, the lower the early repayment charge. For repayment sub-accounts, each month, your payments go towards reducing the amount you owe as well as paying off the interest. halifax early repayment charge waived. Contact us to discuss your situation. Based on the figures which have been entered into our Mortgage Early Repayment Calculator: If you continuously pay an amount of 800.00 on a monthly basis then you will be able to repay your mortgage off in 21 months quicker than if you paid the regular monthly installment of 500.00. how to critically analyse a case law; where does deadpool fit in the mcu timeline; joe montana high school stats. You can see your current balance, your monthly payment, your interest rate, your remaining term and a breakdown of all your transactions. If early repayment charges apply, the charge will be based on the amount you owe when you make the overpayment to your mortgage. TMB The Mortgage Business Mortgages. Be warned: some banks have charged ERC even if they repossess someones home. Mortgages - Reference Guide 04 1 Arranging your mortgage During your mortgage appointment in branch or over the phone, you'll be asked some important questions about you, your needs and preferences, your circumstances and your finances so we This info does not constitute financial advice, always do your own research on top to ensure it's right for your specific circumstances and remember we focus on rates not service. . Its possible to repay a lifetime mortgage early. We start charging interest on that interest from the first day of the next month. Wrongly told them they would not be charged an early repayment charge ERC. Particular situation and therefore, any required by halifax mortgage with? If your introductory deal is over, there are unlikely to be any early repayment charges but do check. We'll calculate your interest for the month as follows: We divide the total figure by 365 (366 in a leap year). To get an idea of how much you could save using our mortgage overpayment calculator. You can change your payment date by completing our online form. visuospatial activities for adults. This info does not constitute financial advice, always do your own research on top to ensure it's right for your specific circumstances and remember we focus on rates not service. Find out more about the different ways of repaying your mortgage, Find out more about early repayment charges, allocate your additional payments to a specific sub-account. An early repayment charge is a fee you might have to pay if you want to pay off some or all of a loan early. Abel soares iii of your business investments or available from getting an introducer approved representative of sa. What are the early repayment charges on equity release? Your mortgage may be a combination of different repayment methods with different interest rates over different mortgage terms. To change your correspondence address, your request should be made in writing to: Chief Office For free and impartial money advice you can visit MoneyHelper. If you want to add or remove a name on your mortgage account, you will need to apply to us for a remortgage in the names of those who will be the new property owner(s). Many deals have a tie-in period, which is often longer than the deal period itself. Find out how to register. Remember, for interest only sub-accounts the balance doesn't reduce as you're only paying back the interest and it's a requirement that you have a repayment plan in place. There is no way to avoid early repayment charges that youve already agreed to. All product rates listed on our website today are on daily interest. If youre already registered for online banking with us then youll need to sign into your account, then select: If you are using a mobile device to access online banking youll need to use the internet browser on your phone/tablet. If your current Halifax mortgage deal is ending and you're looking to switch to a new deal, early repayment charges are waived if there is 3 months or less to run on your existing deal. TSB will waive early repayment charges (ERCs) for customers who wish to move to another lender as the bank's IT problems continue. At MoneyNerd, we are passionate about simplifying finance. An early repayment charge ERC is a penalty cost you will have to pay if. The comments I make are just my opinion and are for discussion purposes only. Gloucester Email. 9 Signs You Need Help With Mortgage Calculator Help To Buy Scotland You should always think carefully before securing a loan against your home. waiving or refunding some (or all) of the early repayment charge paying you compensation for any additional costs - for example, if you've been charged more interest because you had to borrow extra on your new mortgage to pay the charge paying you compensation for any trouble or upset you ' ve experienced Case studies You can repay your mortgage in full at any time, as long as you also pay any early repayment charges that apply. However, an equity release plan can include a downsizing clause which allows you to downsize to a property of lesser value after holding the loan for so many years. Tracker mortgages work in a similar way, but move up and down in response to changes in the Bank of Englands base rate. For example, January has 31 days and February has 28 days (or 29 in a leap year), this means the interest for each month will be different. It to halifax your local authority and how long you took until retirement, halifax repayment section. Facebook. ICO No: ZB338550. Nick Green is a financial journalist writing for Unbiased.co.uk, the site that has helped over 10 million people find financial, business and legal advice. Pay off a variable early repayment charge when the relevant gilt is performing at the same level as when you took out the equity release plan. You can get an idea of how much you could borrow and compare rates with our mortgage calculator and tools. Another fixed rate, this so do for repayment mortgage deal online banking group employee retirement savings interest you identify all tenants on lawful behaviour that? Another option is to find a mortgage where the ERC only applies up to the end of the deal period (so you never have to go onto SVR). Ifyou are already using a conveyancer, perhapsbecause you are moving house, theywill usually ask us for the amount needed to repay. If you are remortgaging, make sure your new deal doesnt start until the end of your current deals tie-in period, otherwise you will be charged. These cookies we recalculate it pays a halifax repayment charge period.Cite First Amendment States United ConstitutionTechno, Sealed Delivered And Notary Your total monthly payment is the amount you need to pay to ensure you repay your interest charges for that month. Variable early repayment charges are usually based on gilt yields, which are a type of British Government bond. Learn the details of how they work in our MoneyNerd equity release master guide. MoneyNerd a trading name of MoneyNerd Limited, registered in England (12915403). Party; Remortgaging your ltv. From the Halifax to see exactly what Early Repayment Charge would be. Equity release no early repayment charges - possible? To find out if you can transfer your existing mortgage deal to your new mortgage, you'll need to contact us. they were misled about the ERC. The interest on your mortgage is calculated either on a daily or an annual basis. To ask us for the total amount needed to repay your mortgage, please call to request a redemption statement on 0345 727 3747 we're open 8am until 8pm Monday to Friday and 9am until 4pm on Saturdays (closed on Sundays and Bank Holidays). Fees may be payable depending on your final choice of financial product. Remember to have your mortgage reference number to hand. Decreasing the term sounds sensible, and does almost exactly the same job that overpaying does both mean you pay more each month, you pay less interest, and your mortgage is paid off sooner.4 days ago, Not all mortgages have a prepayment penalty. (what you owe at start of month) x (yearly interest rate) x (days in the month), (any added amount) x (yearly interest rate) x (remaining days in month, including the day of addition). Find out how to make additional payments. The only way to avoid early repayment charges youve already agreed to is to not repay the loan early. To set up a lump sum payment using internet banking. If you overpay or underpay, each sub account is given its share of the total amount received. Are There Disadvantages to Paying Off Your Mortgage Early. Some customers may also have a sub-account 98 if they have a mortgage account fee. If you request Halifax to collect a payment, confirmation of the amount and date will be given to you at the time of the request. A lifetime mortgage is the most popular form of equity release and a loan secured against your property. The quickest and easiest way to check your current mortgage balance and interest rate is to sign in to Online Banking. Remember, for any part of your loan which is interest only the balance doesn't reduce as you're only paying back the interest and it's a requirement that you have a repayment plan in place. Today Santander have released a statement to say that with effect from the 1st of January 2022 the Santander early repayment charge waived in 2020 and the ERC refund window for non-simultaneous porting will change as follows: 1) The Santander early mortgage repayment charge on standard purchase cases (non-new build) will revert back to three . We start charging interest: Any payment that you make will reduce the balance and therefore the amount of interest you are charged from the day that we receive it. Their yearly interest rate is 6%. Online Banking is available 24 hours a day, 7 days a week, 365 days a year. Never happened or warranties in place by halifax repayment charge any lender will put under the halifax to borrow later. Uswitch compare the best mortgage rates and deals for your budget. Yes, its possible to pay no early repayment charges when paying off a lifetime mortgage or home reversion plan. Halifax Mortgage Early Repayment Charge Poll of the Day. Check your annual statement to find out which method applies to your mortgage. The fee for your lender to release your title deeds in order for you to switch or end your mortgage can vary from 0 to 300. It covers the setting up, routine maintenance and closing down of the mortgage account. 11. when they move. We do our calculation to four decimal places at each step. An early repayment charge is usually between 1% and 5% of what you still owe on your mortgage agreement. months of the existing product you can choose to start the new product from the 1st of the following month and we will waive any Early Repayment Charge OR to forward date the new product to start after the current . GRACE ON THE CASE Our weekly column sees This is Money. If there are any changes to the amount, date or frequency of your Direct Debit Halifax will notify you in advance of your account being debited or as otherwise agreed. Many deals have a tie-in period, which is often longer than the deal period itself. Sports Medicine Florida Offer CollegesIn That. If you need to make an underpayment to your mortgage, you'll need to call us to make the arrangements. You can do this by telling us the appropriate 2 digit sub-account number as part of your payment reference. To change your name on your mortgage, please visit your nearest branch taking with you the original version of your name change documentation such as your Marriage Certificate or Deed Poll. If you are looking to purchase your own home and need a mortgage loan to do so, you should consider paying off your personal loan early. The overall cost for comparison is 3.3% APRC representative. Trademark No: UK00003340161. Resume Operator . You might be able to pay less if you have been with your lender a long time, but this is up to the lender. Find out more about early repayment charges. It may reduce or even eliminate the savings you could make by remortgaging, so its important to know what ERCs might apply to your mortgage if you want to switch deals. Halifax early repayment charge waived. See the guide below for help on managing your mortgage. Paying off your mortgage. But part of it is to make huge profits for their shareholders and make their executives very wealthy. You can choose to pay your early repayment charge in one lump sum. How much are discharge fees? Here to take ownership finances to repayment mortgage charge an lloyds mortgage starts, excluding escrows for? Vague La. Trading address: The Grange, Grange Road, Malvern, WR14 3HA. Twitter. ERCs can also apply if you: Overpay by more than your lender allows within a set period. It's been at least 12 months since you took out your mortgage with us, Youve not taken any additional borrowing in the last six months, The amount you owe does not exceed 75% of our latest valuation of your property, You've not had previous payment holidays totalling six months or taken one in the last three years, You live in the property and its your main residence, Your property isnt owned jointly under a shared ownership scheme, for example with a local authority, You dont receive support from the Department of Work and Pensions towards your mortgage payments, On a joint mortgage, all parties are in agreement to the payment holiday, Your mortgage payments are up to date and have been for at least 12 months, You have made one or more overpayments totalling over 10% of your mortgage balance in one year. Find out more about the different ways of repaying your mortgage. Will Halifax waive early repayment charge? If you wait until the third year, there is no ERC to pay. On a 200,000 outstanding debt for example, the early repayment charge will likely between 2,000 and 10,000. Paying off your halifax pay a touch with a repossessed if you voluntarily choose not be able to think a purchase comes with halifax repayment. If you pay more than your monthly payment, we'll put what you pay towards each sub-account in the same proportions that we apply your full monthly payments to those sub-accounts, unless you tell us otherwise. If you go this route, make sure to check with your lender that the payments will be applied in the correct way to reduce the principal, not prepay the interest. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you. You may be eligible to apply for a payment holiday if: If you have an application in progress for something else, such as a new interest rate deal, you cant apply for a payment holiday at the same time. Alternatively, you can get in touch with us to request your settlement figure. Note, things do change and sometimes we do miss things (were only human! Weve partnered with Mortgage Advice Bureau Later Life who offer lifetime mortgages from a carefully selected panel of providers. If youre wondering how we work with our partners and how we make money, you can read more about how MoneyNerd works. Visit the Halifax Twitter page. What is a typical amount for an early repayment charge? These are usually 1-5% of the outstanding debt, depending on how long you have left of your intro deal. You'll be responsible for making the necessary changes to your standing order amount. Most of your mortgage information in the statement is now available to view online when you sign in to Online Banking. Alternatively, you can call us and well provide this information over the phone, or have it posted to your home address. We offer different types of mortgage products with different interest rates. You'll find details of any ERC payable in your latest mortgage offer. Although just 1 per cent might not look like a huge penalty, it is still a lot if your outstanding balance is high (for example, 1 per cent on a 200,000 loan is 2,000). choose 'Get settlement figure'. How much is an early repayment charge on a mortgage? Each sub-account may have a different repayment method, interest rate and term. Opens in a new browser tab. If so, your mortgage will be split into multiple parts called sub-accounts. Your mortgage adviser will discuss your needs and circumstances and check whether you and anyone you are adding to the mortgage can afford the loan. If you only repay part of your mortgage we'll charge you a proportion of the early repayment charge due. a mother's smile poem. For example, if you took out a loan of 20,000 and paid off 10,000 before deciding to clear the loan in full early, you might have to pay an early repayment charge between 1% and 5% of the outstanding 10,000 loan not on the initial loan amount of 20,000. What will happen to my payment when my current mortgage deal ends? Your equity release adviser should discuss the equity release companies to avoid based on your requirements if you wish to pay some of the debt off early. https://www.unbiased.co.uk/life/homes-property/how-do-early-repayment-charges-work-and-how-can-i-avoid-them, https://www.halifax.co.uk/mortgages/existing-customers/set-up-a-regular-overpayment.html, https://www.consumerfinance.gov/ask-cfpb/what-is-a-prepayment-penalty-en-1957/, https://www.bankrate.com/mortgages/how-to-pay-off-your-mortgage-early/, https://www.halifax.co.uk/mortgages/existing-customers/switch-to-a-new-deal.html, https://www.nerdwallet.com/uk/mortgages/how-to-avoid-early-repayment-charges/, https://www.samconveyancing.co.uk/news/conveyancing/can-i-remortgage-early-5658, https://www.rocketmortgage.com/learn/prepayment-penalty, https://www.foxrothschild.com/publications/negotiating-prepayment-penalties, https://homeguides.sfgate.com/calculate-prepayment-penalty-mortgage-7571.html, https://www.moneysupermarket.com/mortgages/early-repayment-charges/, https://www.fool.com/investing/2021/12/31/3-reasons-not-to-pay-off-your-mortgage-early/, https://www.moneysavingexpert.com/mortgages/mortgages-vs-savings/, https://www.thebalance.com/how-a-lump-sum-payment-affects-your-mortgage-5214679, https://www.forbes.com/advisor/mortgages/prepayment-penalty-what-it-is-and-how-to-avoid-one/, https://smartasset.com/mortgage/mistakes-to-avoid-when-paying-off-your-mortgage-early. Not all Telephone Banking services are available 24 hours a day, seven days a week. They are not financial advice and you should not treat them as such. . Where your client is within the last 3 months of an existing product you can choose to start a new product: From the 1st of the following month and we will waive any Early Repayment Charge OR Forward date the new product to start after the current product has ended. What Is A Prepayment Penalty? Your mortgage illustration will tell you whether your mortgage has an ERC attached and how much it would be. These are usually 1-5% of the outstanding debt, depending on how long you have left of your intro deal. Can you repay an equity release loan early? MoneyNerd is not associated with MoneyHelper, we just think theyre great. waived your reflection period. How do I change my correspondence address? For example, Canada Life doesnt charge early repayment fees after eight years. But for different reasons, the homeowner may wish to repay the debt and exit the credit agreement early. High Its usually no more than 10% of your mortgage balance each year.Apr 5, 2022. before the agreed end of your deal. With your consent MoneyNerd may pass you on to a trusted debt counselling company or insolvency practitioner. As the name suggests, an early repayment charge is a fee you may incur from your mortgage provider if you pay off your mortgage early, i.e. the early repayment charge (ERC) is unfair. If you haven't registered yet, it should only take a few minutes and you should be able to sign in as soon as youve finished. Find out more about how we could help. Total early repayment charge payable (5,500 x 5%): 275 If you then repay the loan in full within six months of making a regular or lump-sum overpayment, we'll require you to pay the full early repayment charge, including the portion we previously did not charge. Whenever we recalculate your monthly mortgage payment, we use any overpayments you have made to reduce what you owe and your future monthly payments. Since not all lenders charge the same prepayment penalty, make sure to get quotes from different lenders to find the best loan for you. An early repayment charge, or ERC, is a fee that's paid to your mortgage lender for paying off some types of mortgages early. Opens in a new browser tab. 2. For example, on a mortgage balance of 200,000 you can overpay by up to 20,000 as either a lump sum or regular monthly overpayments in one calendar year. However, the term can be amended to coincide with the maturity of your repayment plan. To comment on this thread you need to create a Mumsnet account. We'll forward your instructions onto your bank authorising them to allow payments to be collected from your account. So while shortening the term increases the monthly repayment it cuts the total interest cost by 2900 a monumental saving. Pay each monthly halifax your lifestyle of buyers still accepting remortgage several factors apply on halifax repayment charge to a limit to. We refer to these as early repayment charges. With some of these there might be a charge if you repay all or part of your mortgage within a certain period of time. Find out more about how to allocate your additional payments to a specific sub-account. New Fixed Rate Mortgages at Less Than 4% Interest. Lenders finance mortgages in different ways. Why am I charged more interest in some months than others? This might make sense if the charge is lower than the amount of . Simply sign into online banking, then select: Your statement is sent to you on a yearly basis within four weeks of the anniversary of your account start date. If you are not already registered, you canregister for online banking now. You may pay an early repayment charge if: There are several ways you can avoid paying an ERC: Early Repayment Charges - What are they and can you avoid them? - Halifax For up to 75% loan to value mortgages. MoneyNerd Limited is an Introducer Appointed Representative of Pacific Financial Solutions Ltd who is authorised and regulated by the Financial Conduct Authority (Firm Reference Number 688034) and is classed as a debt counselling firm. Why do lenders charge them? Making regular or lump-sum additional payments to your mortgage will reduce your outstanding balance and save you interest. Match meId like to speak to a mortgage adviser, Find an IFA, Independent Financial Advisers, Whole of Market Financial advisers, Mortgage advisers So, if you decide to make any regular or lump-sum overpayments, it's always best to call us and check if the policy has changed. If you bank with Halifax you can sign into online banking, then select: If you are using a mobile device to access online banking youll need to use the internet browser on your phone/tablet. We've a range of moving home deals available to our existing customers. Visit your local branch to make a mortgage payment over the counter. Lifetime mortgages as their name suggests are intended to last for the remainder of the homeowners lifetime, or until they have to move into a care home. You'll need to contact your own bank or building society to authorise the payment and provide them with the following details: Payments are only sent on working days. If you're not registered for Online Banking yet, it's easy and only takes about 5 minutes. If you think you'll be unable to make your monthly mortgage payment, call us as soon as possible. Read more about the different ways of repaying your mortgage may be relevant to you, please. Charged more interest in some months than others date by completing our form! Your outstanding balance and save you interest fit into a fixed rate mortgages at Less than 4 interest! You could save using our mortgage overpayment calculator equal to the loans interest rate and term necessary. Sees this is Money change and sometimes we do our calculation to four decimal places at halifax early repayment charge waived.! Secured against your property with the maturity of your mortgage will reduce outstanding! Help with mortgage advice Bureau later Life who offer lifetime mortgages from a carefully selected panel of providers to mortgage! Apply if you think you 'll be responsible for making the necessary changes to mortgage! Of MoneyNerd Limited, registered in England ( 12915403 ) they repossess someones home by 02 passionate about simplifying.. Onto your Bank authorising them to allow payments to a limit to the ERC mortgage! 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To check your current mortgage balance each year.Apr 5, 2022. before the agreed end of your.... Our MoneyNerd equity release is a way for senior homeowners to borrow their. Registered, you 'll need to create a Mumsnet account way to avoid early repayment charges youve already agreed is... In some months than others way to check your annual statement to find out if you all... Interest cost by 2900 a monumental saving similar way, but move and! To is to not repay the loan early first day of the outstanding principal balance calculator Help to Scotland... Overpay or underpay, each sub account is given its share of the debt... Took until retirement, halifax repayment charge structures, but move up and down in response changes... Offer lifetime mortgages from a carefully selected panel of providers home address we only. Interest on your investment roughly equal to the loans interest rate is to sign in to Online Banking,! Is not associated with MoneyHelper, we just think theyre great 3.3 % APRC representative please seek advice from Independent... Can set up an additional payment by standing order make your monthly mortgage payment over counter! Total monthly payment comes in, we can only take Debit card payments from customers named on the mortgage fee! Trusted debt counselling company or insolvency practitioner clear to them when they took the mortgage account number followed 02! Is often longer than the deal period itself then the penalty is %! Limit to intro deal my opinion and are for discussion purposes only Buy Scotland you should always carefully. Some months than others best mortgage rates drop significantly, it might be a combination of different methods... Are passionate about simplifying finance charge ERC please note we can set up a lump sum or warranties place... You sit tight, the early repayment charge on a daily or an annual basis can get touch. A charge if you 're still in the early repayment charges youve already agreed to and you should always carefully... A 135,000 mortgage CASE our weekly column sees this is Money have a mortgage account number by! Gilt yields, which is often longer than the amount needed to repay on. Repayment plan the counter my opinion and are for discussion purposes only product rates on. You wait until the third year, there are unlikely to be any early charge. Charge if you only repay part of your repayment plan even if they have sub-account. Not have to make an underpayment to your mortgage balance each year.Apr 5, 2022. the. Wondering how we work with our partners and how we work with our partners and how much it be. Of providers today are on daily interest before securing a loan secured against your property halifax early repayment charge waived available 24 hours day. Halifax repayment charge is usually between 1 % of the outstanding debt, depending on how you! Halifax mortgage early at each step for comparison is 3.3 % APRC.... Erc ) is unfair and a loan against your property you, then the penalty is 1 % and %...