Those with active financing know well how much the amortization period never seems to end. Fortunately, it is possible for practically any type of loan to pay all the amounts in advance, in order to get rid of the burden of the installment and go back to enjoying one’s salary or pension in full.
This requirement is even stronger if you have more than one loan open and / or if you need more liquidity: in most cases, even with a paycheck or guarantee, practically no bank grants additional financing if the envelope pay or pension is already “compromised” by other deductions.
A way out is still possible, indeed more than one. So let’s see immediately how the early repayment of the loan works, with a complete overview of everything you need to know before opting for repayment before the deadline.
Equalization of financing: the options
It goes without saying that if you have applied for a loan, it is because you did not have enough money to face certain expenses, but life is fortunately full of surprises, even positive ones. You could receive an unexpected inheritance, get a win, find yourself with unexpected liquidity as a result of a fruitful investment or savings plan, in short a whole series of situations that could help you pay off the loan as soon as possible. The first diktat to get rid of debts is precisely this: to allocate every euro set aside for repayment.
However, if, for various reasons, this is not possible, do not worry: the reserve solution is to request a loan for debt consolidation, which also allows you to lighten the monthly amount intended for the payment of the installments.
Closing a loan with another loan
In very poor words, it’s about closing a loan with another loan. One might wonder where convenience is, but it is easy to say: if you have more funding on, it is undoubtedly convenient to have a warning in place of many different deadlines.
Furthermore, savings should not be neglected: if you balance the contracts in progress, the total cost of credit is reduced, since you do not have to pay the interest and costs due for the residual life of the loan. Of course, interest accrued up to that point will be paid in all cases.
However, many banks and financial companies stipulate a penalty corresponding to 1% of the residual debt by contract; this serves precisely as a partial compensation for interests not enjoyed by the institution. We will see in a little more detail what are the costs provided by the legislation.