Corporate bonds early prepayment

[zbigi]

So I've been investing some portion of my NW into Polish corporate bonds. The current rates are just too enticing - they pay up to 10% a year, for companies that are unlikely to go bust (mostly large real eastate developers, who are currently in a middle of real estate boom and are raking in obscene profits). However, I've noticed that most of them have a clause for early payment of the principal, at the penalty of paying some trivial fee for that (e.g. 1% of principal). In practice this means, that whenever money becomes cheaper, they'll just pay me off with cheaper money borrowed from somewhere else. Is such clause also the norm for US corporate bonds?

[jacob]

They're not unusual. They're also annoying to deal with since they usually get called when the market is most optimal for the seller and least optimal for you. As such they (should) trade as a discount to make up for that.