A sound financial plan helps you pay off your debts. With our tips, you are quickly debt free again. “Credit customers should use the current low interest rates right from the start to pay off more,” says consultant Beer. With an initial repayment of two to three percent, they would be debt free much faster. However, consumers should pay special reimbursement rights on their loans.
Faster debt relief: This is how the repayment works effectively
The fastest possible repayment of loans is not always useful. What the customer should pay attention to when repaying his obligations. Credit is not just credit. Whether for a new vehicle or the elegant leather seat set: Financing for consumer goods are usually provided for 24 to 84 months. In the longer term, the monthly installments are all the more manageable – even if the funding rate is increased: the average interest rate for a $ 10,000 loan is currently at 5.13% for a 24-month and 5.46% for a 60-month loan term.
That’s 439 USD for the instant customer and 190 USD per day for those who want to pay off. If the consumer pays back the payment paid before the deadline? This is also possible without major damage: The statutory maximum rate for installment loans without land registry security is 1.0 or 0.5 percentage points of the remaining debt.
The percentage of the loan amount
However, you must pay annually a percentage of the loan amount to the house bank. If you can do more, you are also debt free faster. In addition, the contract should include the option of being able to adjust the repayment amount over the years to living conditions or income developments. It is sometimes confusing what influences the repayment of mortgage loans.
Many users of our lender comparisons are surprised that the highest-yielding credit institutions at the end of the deadline have the lowest residual debt. With eight percent interest and a repayment percentage, a loan is repaid in almost 28 years. However, with three percentage points of interest and one percentage point of repayment, it would take 46 years, as the lower interest rate savings resulted in a slower repayment.
It is therefore advisable in the current low-interest-rate phase to decide, if possible, to repay two to three percentage points per year.
Although changes in maturities and repayments of installment loans do have manageable effects, mortgage customers should not leave anything to chance when drafting contracts. 3. A long fixed interest rate coupled with extremely flexible repayments currently provide the optimal basis for a worry-free financing period.