prepayment penalty options - which is better?

[Ashley Garner]

Getting ready to buy a multifamily - loan will have a prepayment penalty - bank has offer me two options: 1- declining term option (5%, 4%, 3%, 2%, 1%, 0%). 2- treasury yield (basically it takes the rate you lock in today and IF you want to pre-pay the loan off early it will compare it to the rate that day- if the rate is higher there is no prepayment penalty (as the bank would love for you to pay us off so we can go lend money at a higher rate)- if the rate is lower there is a penalty (and it’s impossible for me to tell you what that penalty would be as there are a lot of variables- time left on the loan, rate that day vs your actual rate etc).  Both of these options still let you pre-pay the loan up to 5% a year with NO penalty)

Which would you pick??

Thanks!!

ASHLEY