I would like to read in depth some of the doubts about early repayment of mortgages, including the need for default payments and the cost-effectiveness of early repayments。

Is there a default on the loan

IN ORDER TO CLARIFY THE ISSUE OF DEFAULT ON EARLY REPAYMENT OF MORTGAGES, TWO MAIN FACTORS NEED TO BE IDENTIFIED. IN THE FIRST PLACE, IF YOUR BANK STIPULATES THAT LOANS UNDER ONE YEAR ARE NOT REPAYABLE IN ADVANCE, THEN MAKING THIS OPTION WOULD RESULT IN DEFAULT. FOR EXAMPLE, AS IN THE CASE OF BUSINESS BANKS, THEY CHARGE DEFAULT MONEY FOR LOANS THAT ARE PAID LESS THAN ONE YEAR EARLIER, I.E. 51 TP3T. THAT MIGHT NOT BE A GOOD IDEA。

Secondly, if you act in violation of the terms of the loan contract, of course, default will also arise. This information will have detailed terms in your loan contract, and if you choose to pay the mortgage in advance, you will have to pay the corresponding breach of contract。

If you decide to repay the mortgage in advance, both factors result in default. Therefore, before taking a decision, you need to contact the bank to know more about the specific provisions in order to avoid unnecessary effects of default。

Given the advance payment, you might wonder if it's worth it. The answer to this question depends, in fact, on a specific repayment modality, which consists of three main elements: the maintenance of the length of the advance partial repayment, the reduction of the length of the advance partial repayment and the full early repayment。

If you choose to pay back in full in advance, you will no longer have to pay interest on the mortgage after that, but will only have to calculate interest on the mortgage prior to the early payment. If, on the other hand, the length of the earlier partial repayment was chosen to remain unchanged, then some principal would be reduced, and thus monthly interest would also be reduced, as it would be recalculated on the basis of the new principal. Finally, if the loan term is reduced by partial early repayment, the loan time is reduced, and interest will be reduced accordingly。