Effect of rate increases appear not miss home loan repayment ahead of schedule

Interest rate effect is about to implement, on an increase for the countdown



The beginning of 2008, loans to buy consumers each month to pay more than the original by about 10% interest. This is Mr. Wang will soon have to face the facts. In January 2007, Mr. Wang bought a set of ancient North at 2,400,000 yuan worth of residential, commercial loan applications for 1,000,000 yuan, equal to adopt repayment of principal and interest repaid in 20 years, when the benchmark interest rate to 6.84 percent, the discount rate to fall 15% Interest at the rate of 5.814 percent, that is, on the repayment 6852.56 yuan.



However, in January 2008 to 1, according to the current 7.83 percent benchmark interest rate to float downward by 15%, or 6.655 percent to calculate the monthly repayment of 7547.56 yuan. Only on the difference between interest payment, the difference between 695 yuan.



This is not just a Mr. Wang who is about to face the reality. At present, the major banks in Shanghai are mostly personal loans with a fixed interest rate adjusted annually on the program, the majority of buyers, this year's 5th rate increase for the month of the year does not affect, but from the 2008 New Year's Day, The impact will be to implement it, early in 2007 the buyers one-stop interest rate increases by 1 percentage point or so.



Strategy: based on their repayment selection method



According to the industry, can be divided into early repayment of all loan ahead of schedule and ahead of schedule part of the loan in two ways. Faster income growth, relatively strong economic strength of the family can be a one-time payment, to maximize the savings will be asked to pay interest. Relatively stable income and relatively few investment channels of the family, can be used high-frequency part of the loan several times.



For some of the early repayment of the loan, there are roughly 3 kinds of ways for them to choose. To Mr. Wang, for example, assume that the early repayment of 500,000 yuan, 434,196 yuan of the remaining principal. Equal to the repayment of principal and interest repayment method to calculate the amount of the 21st century real estate financial experts give the following principal repayment methods.



First, some of the early repayment, the amount of repayment is the same, shortening the repayment period.



7057.42 yuan per month to maintain the repayment, the repayment period be shortened to 6 years and five months. Total interest 93587.69 yuan. This means the overall interest payments at least relatively, for the repayment ability of the customer base is relatively appropriate.



Second, some of the early repayment, the repayment period of change, reducing the amount of repayment.



In the 228 months 434,196 yuan to pay off the loan, monthly repayments required to 3360.2 yuan. Total interest 331,930 yuan. This approach reduces the repayment burden for the month, but the interest savings to a limited extent.



Third, the remainder of the total principal amount of loans to maintain the same, shortening the repayment period.



The remainder of the loan repayment period to 10 years on from the initial amount of 3276.99 yuan to 4964.52 yuan. Total interest 161,546 yuan. This approach can reduce some of the interest, but compared to the second method, and the monthly repayment of the relatively large pressure.



Way above both advantages and disadvantages, according to the individual needs of the borrower's ability to repay current and future expected ability to repay the loan to choose their own way.



Concern: the various bank operations for the difference



In addition to the rational choice of loans, the loan must also know ahead of time for each bank loan to the specific requirements in order to smooth repayment. Co-rich home mortgage transaction manager to remind Mr. Yin, in the course of repayment need to pay attention to these areas.



One, it is necessary to carefully check the loan contract. In the face of the contract on the loan in advance to collect liquidated damages provisions in areas such as the relatively clear, those who repay their loans do homework, the operation was to be bottom. In addition to the purchase of individual bank loan repayment six months ahead of schedule after no liquidated damages, most of the bank provides loan to not more than a year in advance loan to pay liquidated damages to varying degrees. The specific amount of each bank is different, some based on a monthly interest rate of the standard, some banks to the total percentage of the loan amount as a standard. Generally banks on the repayment of more than a year will not be liquidated damages.



Second, it is necessary ahead of time and an appointment to repay bank loans, the best two weeks to one month in advance. Due to already by the end of November, there are plans to repay the need to seize the moment. Each of the banks are not conditions of appointment, will be able to repay their loans ahead of telephone banking.



Third, we should pay attention to the date of the agreement must comply with the good, otherwise there will be bad records.



Repayment would be premature: other ways to save money



Indeed be able to repay their loans ahead of schedule to save the effective interest rate, but that does not mean that we all rush to repay their loans ahead of schedule, some ahead of time is not suitable for the loan.



First of all, more investment channels, household income structured finance loans to those who do not have to repay their loans early. For them, it could be an appropriate increase in mortgage ceiling, to optimize the family's reasonable financial structure, the more revenue for investment. At present, capital markets, a higher rate of return if there is a good investment, then the proceeds can offset mortgage interest and in excess of expenditures.



Second, the loan has a certain time of the loan were not suitable for early repayment. Since the early repayment of the amount of time also by all as the principal, after the repayment of the remaining principal, as the re-calculation of the amount of repayment, the loan more than a certain number of years, the province can not repay their loans early interest. In particular, the use of matching principal and interest repayment, the early repayment of more interest is that the latter part of the expenditure was mainly to the principal. Yi-chen letter home buyers to remind customers of financial management experts, the use of principal and interest loans and matching loans of more than 1 / 2 years, there is no need to repay their loans early.



This is part of the need for early repayment of the loan are, in fact, can also be other ways to control due to the adjustment of interest costs.



Relevant recommendations, the banks have the option of matching products to save interest, such as through free trade to select some of the mortgage banks for the fortnight, the loan-to-air balloon, fixed-rate products; or select some of the bank's financial products, such as loan-deposit Arrived in loan business to increase the deposit interest loans to reduce interest payments.