Repayment of a mortgage loan midway is considered early repayment. Banks also have requirements for early repayment. Prepayment of a loan less than one year will require liquidated damages.
The common loan repayment methods of banks are divided into equal principal and interest repayment and equal principal repayment. No matter which repayment method is used, paying off the bank loan in advance can save a certain amount of interest. ?
1. If you choose the repayment method of equal principal and interest, if the repayment period does not exceed 1/3 of the loan term, you can repay in advance; ?
2. Choose equal principal and interest. If you use the gold repayment method, if the repayment period does not exceed 1/4 of the loan term, you can make partial early repayment; ?
3. If you have spare money and no other expenditures and investments, it is recommended to repay in advance ;?
4. When applying for a second mortgage loan, you must pay off the previous loan and complete the cancellation of the mortgage before you can apply again.
Extended information:
Prepayment is the amount paid by the borrower in excess of the monthly principal and interest payment. A prepayment that does not fully repay the mortgage is called a partial prepayment. Through contractual arrangements, early repayment is prohibited within an agreed period, which is called the lock-in period. The lock-in period ranges from 2 to 10 years. After the lock-in period, prepayment protection often takes other forms, such as prepayment penalty points or yield maintenance fees.
Prepayment includes three situations: full repayment in advance, partial repayment in advance and the loan term remains unchanged, and partial repayment in advance while shortening the loan term. Lending banks can only accept applications for early repayment from borrowers starting from the second repayment month of the personal loan. Although early repayment can save interest expenses, there are four types of home buyers who are not suitable for early repayment.
Baidu Encyclopedia-Early Repayment