The commercial loan period reduction is effective immediately. To shorten the term of a commercial loan, you can apply to the bank. Once approved, the loan term can be shortened, but the corresponding monthly repayment amount will increase. After the loan term is shortened, the interest rate is determined based on the remaining repayment period. After the loan term is shortened, the interest rate is determined based on the remaining repayment period. The remaining repayment period is 5.50% for less than 5 years, and 5.75% for more than 5 years.

The difference between prepayment reduction and reduction

Reduction refers to shortening the repayment period, for example, shortening the repayment period from the original ten years to five years, etc.

Reduction refers to shortening the future repayment amount, for example, from the original monthly repayment of 2,000 yuan to a monthly repayment of 1,000 yuan.

Which one is suitable for repaying the loan early and shrinking the loan period?

Shrinking the loan reduces the principal of the loan, while shrinking the loan term reduces the loan term and increases the monthly repayment amount. So if possible, pay off the loan in advance and reduce the amount. If you have money, you can pay off the loan in advance.