Today, almost everyone meets their cash needs by means of low interest, long term housing loans. With the increase in the amount of money or salary you get, people who increase their monthly income may want to pay off their loan debts immediately. So, is it really a good idea to close your loan immediately with the cash you get?
Advantages of Early Payment of Credit
Loan debt paid early before the term expires, psychologically relieving credit holders from intense stress.
Pay your debt in a shorter time to reduce your current debt status will increase your credit rating and you will be able to use easier credit in the future.
You can allocate the rest of the insurance amount you paid when you take your loan from the bank.
One of the most important advantages of early payment of your credit will be to get rid of the interest you pay. The sooner the loan is repaid, the lower the interest rate you will pay.
This is very positive for your budget. You can calculate how much interest you can avoid from the payment plan given by the bank. If you cannot access your payment plan, you can instantly create your sample payment plan through our Oluşturma Credit Payment Plan Creation ”tool.
Disadvantages of Early Payment of Credit
Only for housing loans, a penalty payment is made if the loan is closed early. However, because the penalty amount will likely be much lower than the total interest amount you will pay, you will make a profit, not a loss, on your loan payment.
If your credit rating is low, closing the loan early will have a positive effect since your debt will decrease, but it is not as effective as regular payment.
In other words, monthly credit payments are more effective for increasing the credit rating. You can find more detailed information about this subject in our article Nasıl How to upgrade your credit rating? ”.
How is Early Payment Different in Housing and Consumer Loans?
There are a number of penalties in case of early payment, which applies only to housing loans. For housing loans, 1% or 2% of the loan amount is collected from the owner of the loan as an early settlement penalty.
If the remaining maturity of your debt is less than 36 months, 1% is taken and 2% if it is longer than 36 months. (You can do this calculation through our “Early Payment Penalty Calculation” tool).
There is no penalty for early payment in consumer loans. Only in case of early payment, the interest amount will be deducted by not paying.