Early loan repayment
The desire for the rapid closure of accounts payable is every person. With a monthly payment in excess of planned volumes or a premature payment of debt, people want to achieve one goal to reduce unnecessary overpayments. Let us consider in detail the features of early repayment of a loan, whether it is possible to reduce the cost of the loan. To do this, you must familiarize yourself with the technical side of the procedure.
Calculation of early repayment benefits
With a differentiated lending option, early repayment is beneficial because the interest rate is calculated on the residual debt.
It will be more difficult with annuity payments. The bulk of borrowers think that the benefit of early repayment of the loan will be noticeable only in the initial stages of the contract. They believe that at the final stages the payment of the “body” is made and the repayment of interest charges in the first months. However, in the case of an annuity, the payment of the main interest is made in the first part of the contract; therefore this scheme allows saving more.
Rules for the early repayment
A visit by a borrower to a banking institution one month before the planned day of closing the debt, writing a notice of his decision, indicating the planned fee. Each bank has individual deadlines. About the rules for the preparation of the application, you can ask a specialist.
Appeal to the manager for a result. Many institutions immediately give their consent, but sometimes you need to wait 5 days.