A installment loan with special repayment is the better alternative to make a special repayment of the installment loan in the event of unexpected incoming payments or through additional savings measures. Special repayments enable the loan to be paid off more quickly. You can easily calculate a installment loan with special repayment using our comparison calculator. Compare possible repayment options that you as a borrower can consider in the case of special repayment.
The special repayments reduce the remaining debt of the installment loan
The decision to use the special repayment of your installment loan pays off in minimizing or completely paying off the remaining debt. With a reduction in the remaining debt, the number of monthly installments and the total interest burden decrease. When concluding a new installment loan contract, make sure that a prepayment penalty is due, because additional fees as part of the special repayment will ultimately reduce your interest savings.
So work out whether there will be any significant savings for you with a special repayment, only then is the installment loan special repayment to be recommended. Read the loan agreement carefully and only conclude it if you agree to all the terms. In the small print of the loan agreement you will find all important details that inform you about the terms of the contract.
The installment loan with special repayment for flexible payment
If necessary, shorten the term of your loan with a special repayment. Additional unscheduled payments to the lender often allow you to pay back the loan in full faster than expected. The possibility of special repayments offers advantages for the borrower. For the bank, however, interest losses are incurred as part of the early repayment, which are offset in some loan contracts by a prepayment penalty fee. Before concluding, check the loan agreement for this possibility and its costs. For you, a special repayment paves the shorter way to freedom from debt if the prepayment penalty is reasonable.
Is it worth repaying my loan?
An installment loan with special repayment offers you the option of repaying the loan faster than actually stipulated in the contract. On the one hand, you save interest because you shorten the term of the loan. On the other hand, depending on the loan agreement, prepayment penalty fees may vary. The special repayment only makes economic sense if the prepayment penalty fees are lower than the interest saved. However, as soon as you have the only goal of redeeming the installment loan as soon as possible and accepting the prepayment penalty, special repayment is the best way to get out of debt again.