Lending today is the main direction of cooperation between banking institutions and individuals / legal entities. If earlier banks refused to repay payments before the expiration of the contract, today the legislation has been simplified, and you can make payments ahead of schedule without harming your own budget. Let's see how to do it right.

Differences between full and partial loan repayment

There are two main ways in which you can get rid of a debt obligation ahead of schedule.

1. Make it to the fullest, paying off the debt together with interest at a time and completely covering the entire amount of the debt. After that, no accruals and payments from the client will follow.
2. Choose partial early repayment of the loan by making a monthly payment greater than the monthly annuity. Full closing of the debt does not occur, but the term or amount of payments is reduced by making a partial repayment.

Banking organizations offer both options to choose from, the final decision depends on the conditions of the bank and the financial capabilities of the payer.

Benefits of partial loan repayment:

• reduction in the total amount of payments;
• the possibility of reducing the period during which payments are made;
• feeling of psychological comfort of the bank client.

Disadvantages of partial loan repayment:

• less benefit for the banking organization (but this is not important to the client);
• unlike full repayment, the debt obligation remains with the payer.

The choice of this method is relevant for people who want to relieve themselves of the loan burden as soon as possible, but are not able to repay the entire amount at a time.

The procedure for issuing early repayment of payments

If there is a need to carry out early repayment of a part of the loan, it is necessary to follow the algorithm of actions.

1. Personally appear at the banking organization, taking the documents, and inform about your intention. It is advisable to do this in advance (at least a month before the next payment), indicating the amount of the monthly annuity or simple payment and the desired repayment period.
2. Some banking organizations agree to carry out such procedures immediately on the day of the request, while other institutions may need some time to think and respond.
3. After approval, a new payment schedule will be drawn up, which is issued to the borrower. In the presence of fines and debts, the banking organization undertakes to notify the employee about this.
4. Next, the loan inspector determines the date of the next payment. Usually this is a date that is no later than the date indicated in the schedule. In advance, the borrower undertakes to deposit funds into the account so that by the time of the next payment the new scheme will become operational.

The considered algorithm in some situations may be subject to changes.

• sometimes there is a recalculation of the payment schedule on the day when the borrower applies to a banking institution;
• some banks have made adjustments to the process of closing a loan ahead of schedule, which made it easier: for this, there is no longer a need to notify the institution, the procedure can be done via the Internet.

Early repayment of the loan in part: interest rate

If the payment is partially repaid, the tariff in percentage remains at the same level, and the total amount is reduced. In this case, interest must be recalculated. In order to calculate the loan for partial early repayment, you can visit the bank or use the calculator yourself.

But before making a final decision, it is worth observing a few rules.

• study the aspects of the return of loan funds ahead of schedule, they are described in the loan agreement;
• calculate the amount of debt that is assigned to you and compare expenses with your available finances;
• exercise step-by-step control over the closure of debt to your financial institution.

Early repayment of a loan at Sberbank: features of the procedure

Partial early repayment of a loan through Sberbank Online will reduce the amount of overpayments. In accordance with the law, the obligation to pay is present only for the actual term of using the credit loan, respectively, the smaller it is, the less the overpayment. Eat two repayment options - in person or online.

Drawing up an application: features

When notifying the bank of your decision, an application is drawn up containing a number of mandatory details:

Sample Application

• the amount of early repayment;
• date of payment.

The Importance of Notifying the Bank in Advance

Simply transferring to the bank an amount that would exceed the monthly payment and expecting a change in the payment schedule is not enough, since this operation is accompanied by formalities.

Sberbank, without receiving notification from the borrower, will not accept a payment in excess of the annuity as early repayment of the loan. The money will be debited from the account, but the amount and terms of the loan will remain the same. In addition, there is a need to sign an additional agreement within the framework of the loan agreement, so the bank must prepare for changes in contractual relations.

What amount needs to be paid

A qualified bank employee should calculate the partial early repayment of the loan. The minimum payment threshold for early repayment has no restrictions. Immediately after the recalculation of the monthly payment amounts, a new schedule comes into effect, according to which subsequent payments will be made.

Thus, any borrower can partially repay the loan ahead of time, and the banking organization has no right to prohibit this. But for a competent operation, several rules must be observed.

The article discusses whether it is possible to repay the loan ahead of schedule without interest. We will find out in which banks such a service is provided, and we will also figure out how to partially repay a loan with annuity payments. We have prepared for you step-by-step instructions and tips on early repayment.

Every payer sooner or later has a desire to pay off the creditor ahead of schedule. But, to be honest, not every bank is delighted with such a decision of the client. For this reason, the procedure must be approached with all responsibility.

Is early repayment possible and how to properly repay the issued loan, we will discuss in this article.

Features of early repayment

Early repayment of the loan has a number of features. Let's consider them in a little more detail.

It should be understood that your interests and the interests of a banking organization are clearly different. If the bank wants the customer to pay on schedule, then you want to cut your costs. Much depends on the chosen loan program. Here you need to look: does it provide for early repayment or not.

Early repayment is divided into 2 types: full and partial. In the first situation, you need to pay the entire balance of the loan at a time, with the interest that has been accrued at that moment. After that, the loan agreement and the loan itself are closed.

However, there are banking organizations that establish a moratorium on early payments. Therefore, before signing the agreement, read the rules related to payments on your loan product and pay attention to the clause that states the possibility of full early repayment.

If you plan to repay in part earlier than the due date, you need to pay more than the amount indicated in the schedule. One part of the amount covers interest, the second part reduces the body of the loan, in connection with this, the debt decreases faster.

How to pay off a loan early

1. Go to a branch of a credit institution or call there and inform about the planned early repayment.
2. Apply for early repayment.
3. Specify how much you need to pay.
4. Pay the fee. And also make sure that the entire amount is transferred. If even a penny remains, next month you may be charged a payment.
5. Get a loan repayment certificate. It guarantees that after a while the bank will not demand to deposit any more amounts.

it is possible to repay the loan ahead of schedule at any time at your request, and the banking organization does not charge a fee for this.

Is it possible to repay a consumer loan with maternity capital

We will figure out whether it is possible to repay a consumer loan taken from a bank. capital.

The legislation of the Russian Federation clearly regulates the issue of repayment of loans with the help of family capital. When contacting the PFR specialists with the question “Can I pay the loan with mat. capital? you will be explained that it is impossible to repay consumer loans with MSC money (mat. capital). This is due to the fact that cash loans are non-targeted and are issued purely for your personal needs.

As for another frequently encountered question: “Is it possible to repay a car loan with MSC funds”? - Let us clarify that this bill has been submitted for consideration, and a final decision on it is planned at the beginning of 2018.

As a result, with MSC funds, you can repay:

• mortgage loan;
• a loan issued for the reconstruction of existing housing;
• a loan spent on goods or services for children with different disability groups (goods and services must be included in the list of eligible).

Important! The FIU will refuse to transfer funds for repayment if the purpose of using the funds is not indicated in the loan agreement or the goods are not included in the list of permitted.

How to repay a loan at another bank: features of refinancing

First, let's look at what refinancing is. So, refinancing is an offer from a banking organization to repay loans that you have previously issued. The procedure involves the consolidation of several loans received from different financial institutions.

The process of early repayment with the help of refinancing looks like this:

1. You provide all loan agreements with third-party banks to the selected banking organization.
2. Get a certificate from each creditor about the balance of the debt.
3. Gather all documentation as required by the bank.
4. After consideration of your application and its approval, the bank will transfer all funds to the accounts of your creditors.

Next, consider which banks can provide refinancing services. This number does not include, for example, Home Credit, . In these banks, you can only get a non-purpose loan. The following financial institutions work under the refinancing program:

Refinancing is subject to the following conditions:

• term - up to 25 years;
• rate - from 8% per annum;
• amount - up to 100 million rubles.

Applying to this bank has several advantages:

• an application for refinancing can be filled out via the Internet, online;
• You can refinance any loans and credit cards;
• both hired employees and individual entrepreneurs can use the service;
• in addition to paying off the balance of the debt, you can get money for personal purposes.

Alfa Bank

Conditions:

• rate - from 11.9%;
• term - 12 - 84 months;
• amount - up to 3 million rubles.

Peculiarities:

• A credit institution is a bank that repays up to 5 loans at the same time, including mortgages and credit cards;
• the rate will not change even if you have not taken out insurance;
• you can get extra money in cash;
• payroll card holders are provided with individual conditions.

Conditions:

• rate - from 14.9% per annum;
• amount - up to 1 million rubles;
• term - up to 60 months.

Peculiarities:

• if you are a pensioner, then the loan term is 36 months;
• it is possible to change the payment date;
• there must be no delinquency on the current loans of the client;
• for refinancing, your existing loans do not have to be issued in banks of the VTB group.

Conditions:

• rate - from 13.5% for amounts over 600 thousand rubles, 14 - 17% for amounts up to 599 thousand rubles;
• amount - up to 3 million rubles;
• term - up to 60 months.

Peculiarities:

• 6 loans can be combined into one loan;
• you can not only reduce the monthly payment, but also reduce the overpayment;
• refinanced customer loans should not have overdue debt.

Conditions:

• rate - 13.5%;
• term - up to 60 months;
• amount - up to 3 million rubles.

Peculiarities:

• fixed interest rate;
• no need to confirm the repayment of existing loans;
• the involvement of guarantors is not required;
• issuance fees - no.

As a rule, 2 types of payments are used in Russian banking organizations: differentiated and annuity. That is, you pay either a different amount every month, or the same amount.

For any bank, early repayment of a loan is a loss of profit. Previously, this was regulated by fines, but at the moment the situation has changed somewhat. You can repay the loan without commissions, but you must notify the bank about this.

Experts advise borrowers the following:

1. When applying for a loan, check whether you have the opportunity to choose a payment method. Find out immediately about the right to early redemption: whether it is permissible and whether there are any restrictions on the amount.
2. When choosing a repayment method, decide what exactly you want: to reduce the debt or reduce the amount of the overpayment. Reducing the loan term is more profitable than reducing the amount of the payment.
3. If you want to repay all the debt ahead of schedule, it is better to contact the bank office personally: you should not repay the loan using the terminal.
4. Keep all papers that confirm the final repayment for later submission to the bank.
5. Do not repay at the very beginning of the loan term. It is better to close loans 2-3 months ahead of time, since the bank in this case has already received most of the profit. Otherwise, you risk not getting a loan again. And such situations are not uncommon.
6. It is most profitable to repay loans to mortgage borrowers ahead of schedule. So, there is an opportunity not only to save money, but also to quickly get the right to dispose of the apartment at your own discretion, while the family budget is relieved of a heavy burden.

Many people take loans from banks. Sometimes the material side of life returns to normal and a person wants to know how the early repayment of the loan takes place. In the article we will look at how to do it correctly and without negative consequences. Let's give an example of 5 common mistakes. After reading, you will understand the principles and will be able to prematurely pay off the debt in any bank.

Early repayment of the loan - what the borrower needs to know?

First of all, you should understand what early repayment of the loan means. Early repayment - return of money to the bank in part or in full. This should be done to reduce the amount of debt, a monthly payment, or to complete credit obligations to the bank.

The question arises as to whether it is possible to close the loan ahead of schedule? Certainly. This is not difficult if one does it correctly. Even 15 years ago, this procedure presented serious difficulties for the borrower. This is due to the fact that the bank did not want to lose money regularly received from you in the form of interest.

Now the situation has seriously changed for the better. But unclear points still remain, it is necessary to figure out how to correctly calculate the early repayment of the loan.

In case of early repayment, principal or interest is paid off?

With early repayment of the loan, the principal is repaid, but there are nuances. If you deposit more than the recommended amount every month on the payment date, then the difference goes to repay the principal debt. After that, the interest is recalculated and charged on a smaller amount.

The debt to the organization consists of parts:

• the amount that was originally requested and it was approved by you;
• bank interest on a loan;
• commissions, if any. This applies to people who have taken loans for a long time. Now trustworthy banks do not withdraw this part separately and you will not pay for “drawing up documents for issuing credit funds”;
• insurance against accidents resulting in the impossibility of a refund. The insurance is not refundable in case of early repayment of a consumer or any other loan.

Advice! Approval algorithms are more loyal if you take out insurance. You can refuse it and return the money within 2 weeks from the date of signing the papers for the loan.

How is the early repayment of the loan?

We figured out the basic concepts, let's move on to how to repay the loan ahead of schedule. Each financial institution has its own conditions for early repayment of the loan. You can find out about them on the day of taking or at any other time. You can find out in two ways:

• personally come to the bank and contact the employee. Advice can be given to you in any department, it is not necessary to go to the place where they were given out;
• call the hotline.

Advice! Before calling, prepare your passport, phone with the number to which the card is registered and remember the code word. The employee will ask you questions, verify your identity and tell you everything. Without personal data, reporting of financial data is prohibited in order to avoid distribution to unauthorized persons.

How is the partial early repayment of the loan - the main points

With partial early repayment of the loan, two types of developments are likely:

• deposit funds and reduce the term for the full repayment of the debt;
• there is a recalculation of the loan at partial repayment and you will make smaller recommended amounts throughout the payback period.

Conditions vary from bank to bank and before taking funds, you should find out them in a particular case. If you have not done this, call the bank's hotline or go to the branch and find out.

The rules for early repayment of the loan allow the deposit of any amount. It happens that with partial redemption online, a minimum allowable amount is provided. Contact the branch and do it there. An application may be required.

Previously, banks prohibited early closing of a loan within a certain set period. You could not repay the debt if 3-6 months had not passed. from the day of taking. Now the activities of the bank are more strictly regulated and this condition has been canceled. You can carry out early repayment of the loan even in the first month.

If you decide to completely repay the debt to the bank, you are concerned about the issue of interest. We hasten to please, you will need to pay for the period of time when you actually used the money.

Example. Maria Ivanovna took a loan from the bank in the amount of 100 thousand rubles for 1 year at 12.9% per annum. She regularly paid 8,927 rubles a month. After 3 payments, she has funds and wants to pay the bank in full. Since she decided to make it up to 4 payments, she will pay for one month of using the money.

You can repay the loan prematurely in full and at any time. Any obstruction of the bank must be documented in writing. In 99% of cases, no employee will want to sign such a paper and you can easily repay the loan.

Important! If you feel an obstacle from the staff of the department, call the hotline or call the head. Any decisions or refusals of the bank must be issued in writing signed by a specific person.

What documents are needed for early repayment of a loan?

Documents for early repayment of the loan are not required. You are required to provide a debit or credit card. If you pay online, you don't even need a card. It is enough that the person entered the office, knowing the username and password.

The branch officer may ask for your passport, but only to verify your identity. Applications in most banks do not need to write. The procedure has been greatly simplified over the past 5 years.

Five mistakes when paying off a loan early

People who do not want or cannot understand the financial relationship with the bank inevitably have difficulties. For example, the answer to the question of why early repayment increases the total cost of the loan is very simple. The full cost of the remaining loan is a rather conventional value.

It is calculated according to the formula of the Central Bank and depends on many parameters. It can indeed change due to early repayment, but cannot exceed the amount specified in the contract.

5 mistakes of people who do not know how to repay a loan early:

1. Implementation of early repayment not on the day of the standard settlement. If you make monthly payments on the 15th, then early repayment should be made on that day. Otherwise, interest will be deducted from the amount.
2. Negligent attitude to premature payments. There are special calculators on the Internet that make it possible to calculate your benefit. Use them.
3. Ignoring fines. If you are late, you should pay the fine as soon as possible. Otherwise, penalties will be charged on it. The sequence of payments is as follows: fines, penalties, interest, body of debt. If you do not know that you have been fined, this can lead to a lot of additional penalties.
4. Inattention to details. If you decide to pay off the debt in full, make sure that the amount is sufficient. Even when one penny remains unpaid, penalties will begin to drip on it.
5. The bank is always correct. No, it's not. Ordinary people work in financial institutions and the possibility of a human factor cannot be ruled out. A sweet girl forgot to check the box - you will receive a fine. Check and recalculate regularly, errors are detected quickly.

As an example of choosing the day of early repayment, we will provide a calculation. The amount of 100,000 rubles was taken, for a period of 1 year, at an interest rate of 12%, the payment day was scheduled for the 9th day of each month. You decided to deposit 20 thousand rubles prematurely. The graph clearly shows how much you can save by paying money with a difference of only 1 day.

Click to enlarge

How to pay off a bank loan early?

Now you know about the main points and mistakes. Let us briefly summarize the process of how to properly repay a loan early. Follow these steps:

• Find out about the conditions in a particular bank and case. Specify what will change after repayment - debt or term. Ask if you need to notify the bank in advance.
• If it is possible to choose what will be reduced, the term or the total amount, choose the term. It's always more profitable. For example, if you took a loan of 1 million rubles for two years and decided to pay 200 thousand ahead of schedule, then if the amount decreases, you will save 23 thousand, and if the term is reduced, 43 thousand.
• If the bank needs to be notified of the desire to repay, but there is no information on the dates, do this at least 30 calendar days in advance. This period is prescribed and regulated by law.
• After full repayment - take a certificate of no debt. This is a simple procedure. It is free and issued within a minute. This formality may come in handy in the future. So it will be calmer, there will be no thoughts about the remaining penny.
• If you bought insurance, you can return the money for it. If you do not want to do this, then the insurance will be valid according to the established period. If an insured event occurs, the company will return the money even when the debt is paid.

Relations with the bank have become noticeably simpler and you no longer have to wait for tricks from organizations. This applies only to large institutions. In microfinance structures, everything is still not as smooth as we would like.

You decide to make an early payment or pay off the debt in full - calculate your benefits. Use special calculators on the Internet or check with a bank employee. If you approach this matter seriously, you can save time, money and nerves.

Just a few years ago, for those who decided to take a loan from a bank, the burning question was whether it was possible to repay a consumer loan ahead of schedule.

Since the law did not regulate this in any way, each bank had its own rules. Somewhere there was a moratorium on early cancellation. This meant that in order to make a payment in a larger amount than stipulated by the schedule, it was necessary to repay a loan for a certain period of time (for example, six months).

In others, fines were levied for the early redemption procedure.

In this way, banks tried to prevent customers from resorting to early repayment. The reason is simple: for a credit institution, a loan repaid ahead of schedule is a loss of interest income. And this already answers the question of whether early repayment of the loan is beneficial for the borrower.

Early repayment under current legislation

Now you can repay an annuity loan ahead of schedule in any bank. The law provides that creditors do not have the right to prohibit borrowers from repaying money faster than planned, as well as to set any requirements for early repayment (for example, a bank cannot set a minimum amount of an additional contribution or their frequency).

Banks can only include in the loan agreement a clause on the result of the early repayment of a consumer loan: with a decrease in the term of the loan or with a decrease in the monthly payment.

Some may offer customers a choice, while others leave only one way. In this case, the borrower can only accept, since the law only says that the client has the right to make partial and full early repayment. At the same time, the term or monthly payment will decrease, it is not written anywhere.

So, having discussed what early redemption is and whether it is allowed or prohibited, let's talk about how profitable it is.

Is it profitable to pay off the loan ahead of schedule?

As already mentioned, if the client repays the loan ahead of schedule, the bank loses interest. And since the bank does not receive interest, therefore, the borrower does not pay them. It turns out that partial early repayment of a bank loan is beneficial.

There are a few important things to keep in mind when paying early.

First, the recalculation of interest only applies to future payments. If you paid the loan for a year, then no one will return the interest for this period. You used the funds at that time, therefore, the bank honestly earned the interest paid.

Secondly, the bank will recalculate only interest. No matter how many times you make early repayment, the principal debt will not change from this. That is, it will decrease, of course, but by the amount that you repay. In addition, the bank will not write off anything.

Thirdly, the bank will receive its interest in any case. In accordance with the loan agreement, the component parts of the payment are written off in the following order:

• penalties, penalties;
• overdue debt;
• interest for the current month;
• main debt.

As you can see, until the bank writes off absolutely all the accumulated debt, there can be no talk of reducing the principal debt.

By what amount will the principal debt decrease after the "early maturity"?

In your payment schedule, each monthly payment is divided into 2 parts: principal and interest on the loan. For a month, the bank should take as much interest from you in total as it is written in the schedule.

Therefore, when you come to the bank with a certain amount of money, keep in mind that the principal debt will not decrease by it, but by the difference between the amount paid and the interest for the given month.

For example, a client makes an early repayment in March, in which the bank must receive 3,850 rubles of interest from him. The client deposited 40,000 rubles into the account. After the early repayment procedure, the loan debt will be reduced by 36,150 rubles.

When to pay early?

How profitable early repayment will be depends on how long after taking a loan to carry it out. Remember the second rule: only percentages are recalculated. Therefore, it is advisable to issue early repayment in the period when interest is charged the most.

Open your payment schedule and look at the loan interest column. Regardless of whether your payments are differentiated or annuity, the amount of interest charged is constantly decreasing. That is, in the first months they are the largest.

With annuity payments, approximately by the middle of the term, the amount that is taken for using the loan is equalized with the amount used to pay off the loan debt. In the second half of the term of the loan agreement, less interest is received than on the main debt.

A simple conclusion follows from this.

It is more profitable to carry out early repayment in the first half of the term of the loan agreement.

If you do this closer to the planned closing of the loan, then you will receive practically no benefit. Just close the loan a few months earlier. However, it will bring more moral satisfaction.

Reducing the term or payment: which is more profitable?

If the bank has decided for you to reduce the term or payment, then there is nothing to think about: you need to get the maximum benefit in the circumstances offered.

If the decision falls on you, then inevitably there is a desire to save more. Make it so that you end up paying less interest.

What do I need to do?

First of all, you need to remember that the overpayment directly depends on the term of the loan agreement. The longer you pay off the loan, the more you end up paying. It already follows from this that it is more profitable to reduce the term of the loan.

Therefore, choosing a method of early repayment, you need to build on your financial burden. If you have a lot of loans, the total payments for which eat up half the salary, it would be more logical to reduce the payment. Let you save less than you could, but it will become easier for you to pay off the loan.

If you are satisfied with the size of the monthly payment and after making it there is enough money left to maintain your usual lifestyle, then you need to reduce the loan term. It will not be harder for you, because the payment will not increase. And the interest rate will be tangible.

To verify the benefits of reducing the term, you can contact the bank and ask to see two options for the schedule: the first - with a decrease in the term, the second - with a decrease in the payment during early repayment by the same amount.

They will not tell you the formula by which the calculations are carried out during early repayment. Yes, and employees know it only in general terms, everything is calculated by the program. However, you can easily understand which option is more profitable. To do this, you need to look at the "Total" column in the column with interest payments in both schedules. If the loan is large enough, then the difference can reach 100-150 thousand rubles.

With a reduction in the term, the overpayment will be less than with a decrease in the monthly payment.

To understand how early loan repayment occurs, you need to understand how monthly loan payments are made.

As a rule, when people come to the bank and give money to an employee, they think that in this way they instantly make a loan payment. Although the loan agreement states that this is not the case.

The account on which the loan debt is directly recorded starts at 455. Take the documents and see which account you are depositing money into. It starts with either 423 or 408.

This fact does not depend on which bank the loan is taken from, since the system of accounts is the same everywhere, it is regulated by the Bank of Russia.

You deposit money into this account, and there they lie until the date of the next payment. And on this day, they automatically go to account 455, where they are reflected as a monthly payment.

No matter how much you put into the account for debiting, exactly the amount that is provided for by the schedule will go to repay the loan.

What does it take to pay off a loan early? In order for early repayment to be successful, you must either complete this procedure yourself in your Personal Account on the website of your bank, or come to the bank and tell the employee that you want more funds to be spent on the loan than planned.

At the same time, the employee will give you to sign an application for early repayment. Each bank has its own form, but information on the loan agreement, the amount and date of debiting will be there for sure.

Most likely, you won’t have to write a statement on your own: such forms are usually generated by the program, after which the client simply puts his signature.

The deadlines for the execution of the application should be clarified with the credit institution: somewhere the repayment is made on the next business day, somewhere on the same. And some banks practice early repayment online.

Who can apply for early repayment?

For consumer loans, the borrower is usually one person. Co-borrowers are a rare phenomenon. But a mortgage, on the contrary, is more often taken by a husband and wife together. Moreover, in a number of banks, spouses are required to become co-borrowers.

In these cases, the question arises whether the one who is registered second in the loan agreement can carry out the early repayment procedure. Of course, the requirements depend on the bank.

However, from the point of view of the law, both co-borrowers have absolutely equal rights and obligations in relation to the joint loan.

Any of the co-borrowers has the right to make early repayment (full or partial).

The reverse situation is observed if one of the spouses takes a loan, and the second, not being a co-borrower, wants to carry out the early repayment procedure. He will be able to transfer funds to the account, since anyone can do this, but he will not be able to write an application for early repayment.

Early redemption by proxy

In this case, it is necessary either to come to the bank to the borrower, or to ask him to issue a notarized power of attorney for his spouse, where he writes down what powers he allows to exercise.

The more detailed the rights of the trustee are described in the power of attorney, the better. The procedure for repaying a loan ahead of schedule by a trustee in each bank is different, so you should not get off with general phrases.

Regardless of the creditor bank, the notary must write the following information in the power of attorney:

• data of the principal and authorized person;
• a loan agreement for which a power of attorney is drawn up;
• operations, the performance of which is provided for by this power of attorney (obtaining certificates, carrying out full or partial early repayment, and so on).

If it turns out that only the right to issue an early repayment of a consumer loan is registered in the power of attorney, then after that you are unlikely to be told whether the money was successfully debited or if there were any problems.

Conclusion

So, early repayment can be issued by any of the co-borrowers for any amount. You can do this as often as you like, banks have no right to interfere with this procedure. It plays into the hands of the client, so if possible, it is better to repay the loan ahead of schedule.

To get the most benefit, you should reduce the term of the loan, not the monthly payment. As for the question of when it is possible to repay a loan in a bank ahead of schedule, it is advisable to do this in the first half of the term of the contract: savings on interest are maximized.

In order to reduce overpayments, bank borrowers often try to close the loan ahead of schedule. The bank cannot in any way interfere with the client's desire to repay the loan early, therefore imposing fines in this case is illegal. Despite the fact that the procedure itself seems simple at first glance, there are some nuances that should be taken into account.

In order for the bank not to interfere with the closing of the loan, you need to notify the bank at least 30 days before the operation of your desire to repay the loan ahead of schedule. In an application written in any form, you must also indicate the amount that will be contributed to pay off the loan.

Depending on the circumstances, the loan may be repaid in part or in one installment. What is the difference and which method is better to use, we will consider further.

Full and partial early repayment of the loan

Both types of early repayment allow you to reduce overpayments by reducing interest on the loan. Despite the obvious advantages of early repayment of a loan, there are cases when there is no need to rush. For example, a long-term mortgage loan taken for 20 years makes no sense to repay urgently. Since over time, not only interest on the loan accumulates, but inflation also works, “eating up” part of the loan.

Any early repayment of a loan is beneficial for short-term loans from one to three years, although it is better to calculate individually.

Partial repayment

Partial early repayment of the loan consists in paying each month a larger amount than stipulated in the loan repayment schedule. In this case, the bank recalculates the size of future payments, which decrease over time. To determine the exact amount of payments, you can contact a bank employee who will help you make calculations and determine the optimal amount of monthly installments for early repayment of the loan.

To apply the early repayment of part of the loan, you need to notify the bank, which will recalculate the remaining loan amount. The bank needs to indicate the date of early partial repayment, the amount of payment and the invoice. The bank has no right to prevent early repayment.

Full repayment

Full early repayment of the loan involves the payment of the entire remaining loan amount in one payment before the expiration of the loan agreement. By making a full payment of the debt, you completely remove your obligations to the bank.

When planning to fully repay the debt to the bank, find out in advance the exact amount of the loan balance, and after payment, save the receipt.

In addition to transferring money to a bank account, in order to completely close the debt, some conditions must be taken into account. The procedure for closing the loan must be carried out in accordance with the requirements of the bank, so that in the future there will be no claims from the financial institution.

Basic recommendations for borrowers when applying for early repayment of a loan

The terms of early repayment of the loan oblige the borrower to first of all notify the bank about the early closure of the loan and to clarify in full or in part the procedure for repaying the loan will be carried out. Earlier, we have already mentioned that the bank must be notified in writing at least 30 days before the full repayment of the loan (before the expiration of the contract). In some banks, the terms of notification of the intention to repay the loan early may be different, which should be indicated in the loan agreement.

During the partial repayment of the loan, you need to approve the increased payment amount and new loan repayment terms with the bank. If this is not done, only the amount that was originally specified in the contract will continue to be withdrawn from the account. Without notifying the bank of the desire to partially repay the loan, the loan term, as well as the amount of debt, will not change.

Check your loan balance before you pay off your loan in full. Even a small amount in the form of a loan account balance will turn into an unpleasant surprise in the form of unforeseen debts and delinquencies.

After full payment at the cash desk, you need to keep a check on the payment of the entire loan, as well as receive a certificate confirming the repayment of the loan. The document must confirm the absence of obligations to the financial institution and be certified by the seal and signature of an authorized bank officer. You also need to ask for a loan account statement to check the zero balance.

Return of insurance on a loan in case of early repayment

It is impossible to return insurance on a loan in case of early repayment in the event of:

• if the procedure for the return of insurance is prohibited in the contract;
• in the case when the bank acted as the insurer, and the collective form of the insurance contract was drawn up.

If the insurance policy was signed individually at the bank, and there is no prohibition on return, you need to submit an application to the bank branch and receive unused insurance.

If the insurance was issued by an insurance company, then you need to provide more documents, namely:

• passport;
• statement;
• a document confirming the full early repayment of the debt;
• insurance policy;
• loan agreement.

The amount of insurance that can be returned cannot be precisely foreseen, since insurance companies will deduct their additional costs. A full refund of insurance is not provided, since the amount for the period of validity of the insurance policy is necessarily deducted.

When is the best time to pay off a loan?

Depending on which payment system is used for the loan, you can calculate the optimal terms for early payments. There are two ways to make payments and loans:

• annuity;

With an annuity system, the entire loan amount, together with interest accruals, is distributed in equal payments over the full period of loan repayment. Thus, monthly payments are equal, regardless of the balance of the loan obligations.

The annuity system allows you to profitably pay off obligations before the end of the contract. Given the specifics of interest charges, in the first half of the loan period, the payment consists mainly of interest, and then the picture changes and the principal amount of the loan prevails. It is better to pay off such a loan at the beginning of the period. Thus, if you increase the amount of payments (use early partial payment), then part of them will overlap the last payments, and the loan will be repaid faster.

A differentiated system involves monthly payments of a part of the loan (loan body) in proportion to the term of the loan agreement. With each payment, the amount of the payment decreases, as interest is charged on the remaining amount of the debt. This type of payment is more optimal, since the percentage of overpayments is less.

To accurately calculate the amount of early repayment of the loan, use the loan calculator, which is available on the website of each bank. After calculating the amount yourself and comparing it with your personal financial capabilities, contact a bank employee who will make the final calculations and determine the optimal amount of payments for early repayment of the loan.