A small secret in the financial world is that the interest rate on Provident Fund loans is usually lower than that on commercial loans. As a result, many home-buying friends will opt for a Provident Fund loan. But do you know how every month you repay the Provident Fund loan? Come on, let's find out。

How the Provident Fund loan is repaid every month

First, as a debtor, you need to sign a monthly Provident Fund personal loan agreement with the City Housing Provident Fund Centre. In this way, monthly payments may be made or the principal of the loan may be paid in a lump sum if your account balance is in excess of $10,000. At the time of the monthly withdrawal of the Provident Fund, if the balance of the Provident Fund account is insufficient, the attached repayment bank card will perform the deduction。

Even if you get married, your spouse can help repay the Provident Fund loan. They may also enter into such an agreement with the Municipal Housing Provident Fund Centre for a monthly or one-time repayment, provided that the account balance is more than $10,000。

So what are the specific repayment methods for the Provident Fund loans? In fact, there are three main ways:

One-time repayment method: You can withdraw the balance of the Provident Fund from your Provident Fund account and repay the loan once. Many choose this approach after retirement. If the loan is not repaid, the remaining principal and repayment period of the loan is recalculated to determine the amount to be repaid for each subsequent month。

2. Discontinuation of loan for several months: You can withdraw the balance from the Provident Fund account and repay the loan in advance. After early reimbursement, repayment may be suspended for a period of up to 12 months. After the standstill, you need to continue to repay the loan on a monthly basis. Interest on the standstill period is free of interest and interest, and monthly repayments at the end of the standstill period are deducted on a monthly basis. This approach is appropriate for home buyers whose income changes in special circumstances, such as sickness, maternity, unemployment, etc。

3. Month-to-month repayment method: a monthly draw from the Provident Fund account to repay the loan. If the amount of the Provident Fund is insufficient, you need to replenish the amount in a timely manner。

In general, the methods of repayment designed by the Provident Fund loans are flexible, meet the different needs of different home buyers and the process is simple and understandable。