Will the remaining interest be paid after early repayment? What are the precautions for early repayments? Let's talk about it together。

Do you need to pay back interest in advance

When you decide to pay in full and in advance, all future interest will naturally no longer have to be paid. For example, if you're on a 30-year mortgage, and then you decide to pay back in full in the fifth year, then the remaining 25 years of interest will be cut off and no longer need to be paid, won't it be easy

But if you choose to make partial early repayments, the remaining interest will continue to be calculated on the basis of your loan contract, which means that the remaining interest will still have to be borne。

HOWEVER, EARLY REPAYMENT MAY NOT NECESSARILY BE A PURELY COST-SAVING EXERCISE. BANKS USUALLY CHARGE DEFAULTS OF APPROXIMATELY 1%-5% FOR EARLY AND FULL REPAYMENTS, AND SOME EVEN CHARGE TWO TO THREE MONTHS OF INTEREST AS A HANDLING FEE. THIS REQUIRES YOU TO CONDUCT A THOROUGH INVESTIGATION AND CONSULT WITH YOUR BANK BEFORE DECIDING WHETHER OR NOT TO PAY IN ADVANCE. MOREOVER, MOST BANKS REQUIRE ADVANCE PAYMENT TIMES, AND IF THE REPAYMENT TIMES ARE IRREGULAR, EVEN IF YOU ARE WELL-OFF, YOU CANNOT DO SO IN ADVANCE。

Now, let's look at what early repayment requires attention。

First, don't forget to make an early appointment. After a year of your loan, if the bank agrees with your request, you can apply for an advance repayment in writing. It is important to be clear that your bank will need a few days to do the business and to ensure that you are aware of the full operation of the loan bank。

Secondly, your loan documents must be ready. You need to carry an identity card and a loan contract to the bank for approval. If you are prepared to pay off the entire amount, the bank will calculate the amount of the remaining loan so that you can prepare sufficient funds for early repayment。

Finally, let's talk about how interest rates are calculated. The rate of credit will be calculated at the beginning of the new year, so by the end of the year before the new interest becomes effective, you can choose the best time to pay back in advance. And accordingly, when the loan is full, you need to remember to retire to the relevant department。