What should I pay attention to in prepayment?
1. Understand the bank's policy of repaying loans in advance.
Different lending banks have different lending policies. If buyers intend to repay the loan in advance, they should know the bank's policy. Now, for most small and medium-sized joint-stock banks, there is almost no additional penalty interest for buyers who want to repay their loans in advance, requiring them to pay liquidated damages. However, some large state-owned banks need to pay different degrees of liquidated damages. Some banks will specify in the loan contract that early repayment may require a certain penalty. Some banks need to charge interest on the actual repayment amount for one to three months.
2. The document should be ready.
If the buyers intend to repay the loan in advance, they need to prepare the documents for repaying the loan in advance. Generally speaking, after applying by phone or in writing, they should go to the bank for examination and approval with their ID cards and loan contracts. If the borrower has paid off all the balance, after the bank calculates the remaining loan amount, the borrower should deposit enough funds to repay the loan in advance.
3. Whether to pay liquidated damages for prepayment.
For borrowers who repay loans in advance, it is necessary to know whether they need to pay liquidated damages in advance. The bank's regulations on early repayment are actually limited by the number of years. If the lender's loan contract takes effect less than one year, it is best not to apply for prepayment, because the bank may charge one month's interest as liquidated damages according to the amount of prepayment by the lender. Therefore, when considering prepayment, we should choose the right time, otherwise we will spend an extra month's interest and waste some money.
4. Go through the formalities of repaying the loan in advance.
The procedures for repaying loans in advance are the same as those for applying for loans. The borrower also needs to go through legal procedures and must submit a written application one week to one month in advance; Moreover, it is necessary to agree on a specific repayment time. During this period, the lender will also bring some necessary documents, such as ID card and loan contract, and fill in the loan repayment application form and loan repayment agreement at the bank in advance.
5. Go to the insurance company to surrender in time.
Don't forget to surrender to the insurance company after the borrower pays off the mortgage in advance. When signing the housing loan, the buyer will sign the housing loan family insurance contract and pay the insurance premium every month. If you pay off the loan in advance, you can surrender it and bring the insurance policy and proof of early repayment to the insurance company.
6. Handle the cancellation of real estate mortgage in time.
After paying off the loan, the borrower needs to cancel the mortgage of the property in time, which is a key point. The real estate license of the general house is mortgaged by the bank during the mortgage period, and the mortgaged house cannot be rented or resold. Therefore, the mortgage must be released after paying off the loan, otherwise the mortgage record will still be filed in the real estate department, which will lay a hidden danger for the future.