Anyone interested in an installment loan with a special repayment wants a flexible repayment of the loan. The installments for an installment loan are generally the same every month. However, a special repayment can be agreed, which also enables a higher rate.
A borrower can then decide whether he would like to reduce the further installments or whether he would like to reduce the term. Some lenders only approve special repayments on request and other providers automatically assign them. But even if you do not have an installment loan with a special repayment, you can also arrange a special repayment with a lender at a later date.
If a special repayment was agreed in the loan agreement, a lender can also calculate costs. There is a separate regulation for a real estate loan, because there is a fixed interest period for a period of ten years, where costs can then be charged as compensation for the prepayment. Many lenders prescribe the amount of the special repayment, but usually the minimum amount is three times the monthly rate for the loan. It is also common in the industry that the first special repayment is only permitted after a period of six months. Otherwise there are also some lenders who restrict the special repayments during the loan period.
In any case, it can be said that a borrower achieves greater flexibility through a special repayment. Even if a lender then charges a fee for a special repayment, it will still save for the reduction in the loan. The additional costs for higher loan amounts and thus special repayments can also vary greatly from one lender to the other and should always be inquired about. The special repayments should be waived if the lender already incurs fees or increased interest when agreeing on a passage in the loan agreement.
With some lenders, special repayments can be made free of charge and with others this only works at a cost. Often there are no fees for prepayment, but any special repayments can cost between 50 and 100 dollars. For this reason, a prospect should check the costs before entering into a loan agreement. Those who have not paid attention to this should rather make less special repayments. Several sums can also be collected on a savings or call money account and a special repayment is then carried out once a year.
The installment loan with special repayment has been offered for several years. In addition to the monthly installment, additional amounts should be made possible to repay the loan. Overall, this helps the debt to be repaid faster. A special repayment can be counted towards the monthly installment or the remaining term. If, however, the total loan amount is reduced, interest costs can also be saved with the previous installments. Previously, the right to make a special repayment had to be regulated in the contract, but there is a new consumer credit directive. Since 2010, every borrower has been able to make special repayments. This means that some payments can also be made, only there is a minimum amount for some lenders.