for the purchase of a house, many buyers lend to the provident fund because the interest rate is the lowest of all loans. however, after the purchase of the house, you might want to pay that amount in advance. are you wondering if it would be advantageous to pay off the provident fund in advance? let's get a detailed analysis。

Can the interest on early repayment be reduced

In fact, the early repayment of personal Provident Fund loans is not always worth it. Early repayment may be a good option if you have the funds at hand and are faced with choice difficulties in how to invest. Because it saves you some of the interest on the original loan。

But if you invest this extra money in a stable way, or buy high-quality long-term investment products, the return on such investment may exceed the interest on the loan that would otherwise have been paid, or may even have exceeded it。

In the case of interest, interest is bound to decrease if the Provident Fund loan is repaid in advance. It is exciting that you do not have to pay the interest that will arise, but only the interest that will be paid until the repayment date. For example, if you choose to pay off the loan in full and in advance, then the interest on the remaining loan will only be calculated for this early repayment date。

If you choose to pay off a portion of the loan in advance, then the subsequent interest is not calculated on the total amount of the loan, but is recalculated on the basis of the remaining outstanding principal of the loan. So whether you choose to pay in full or in part, your mortgage interest will be reduced。