Qwhoever has a variable-rate mortgage will be exempt from paying an early repayment commission next year, recalls DECO Proteste, who recommends that “if you have some savings, the paying off home loans can be a good solution to reduce performance”.
The consumer protection organization has prepared a series of questions and answers that I came to clarify some doubts about debt amortization in home loans. Stay tuned for 10:
1. Are there minimum amounts to pay the principal amount of the home loan in advance?
“No. The debit can be partial, in the amount available or in total. The greater the amount to be debited, the lower the interest amount to be paid and thus the lower the monthly installment to be paid to the bank. Use the file provided we provided above to simulate the impact of capital write-downs on monthly installments to be paid.”
2. How much of the early repayment fee is paid?
“Currently, the commission to be paid to the bank for early repayment is 0.5% for floating-rate home loans, i.e. five euros for every 1,000 euros repaid. For fixed-rate home loans, this commission is 2%, so 20 euros for every 1000 euros refunded.
However, in 2023, with the measures announced by the government, no early repayment commission will be paid for floating-rate home loans. If you have some savings and a variable-rate mortgage, it might be a good time to pay off the principal on your loan.”
3. Can I pay off the principal of my home loan at any time?
“Yes, you can pay off debt whenever you want. For example, you don’t have to wait for the anniversary of the title deed.”
4. Can the bank refuse early repayment?
“No, as long as there are no contractual restrictions. Although it is rare, for example, the contract may state that early repayment is not possible until a few years after the contract starts.”
5. Is there a limit to the number of debits I can make during the term of the loan?
“No. You can pay off the principal as often as you want, namely every month. However, it is better to save a good amount and make annual payments. If you pay monthly, you will get rid of the principal faster. however, if you depreciate annually, the reduction in the monthly amount to be paid is greater.”
6. Will the installment amount be debited the following month after debit?
“If you partially repay the principal due, the period during which you see the reduction in your monthly payment is seven days. If the payment is total, the term is ten days. However, if your monthly payment has already been spent or calculated, you may have to pay up to wait the next month to see a reduction in the amount to be paid.”
7. I have paid off the full amount of my home loan. What should I do next?
“If you have already paid the full amount owed for your loan, you must ask for the distrate, a free document proving the settlement of the loan to the bank. Then you must ask at a land registry about the burden of proof on the property, since it is given with bank credit as a guarantee when purchased.”
8. I have invested money in a PPR. Can I use this to pay the principal amount of my home loan in advance?
“No. With the PV you can, for example, pay overdue or expired installments on your home loan, but not pay off the principal of the home loan early.”
9. Only four years to go before I finish paying off my 30-year loan. Do I have to write off?
“You can always pay it off if you don’t have an alternative application for your savings that will allow you to achieve greater profitability. However, if you only have four years left to pay off the loan, you no longer pay a very high amount in interest and thus the costs of credit should no longer be too high.”
10. Does the early redemption of debt affect the IRS?
“No. Currently, it is only possible to deduct interest on credits entered into from the IRS until December 31, 2011. Contracts entered into after this date do not have this tax advantage. However, because they are a significant expense for families, DECO Proteste defends that, just like what has happened in the past, it is possible to deduct the interest on all home loan contracts from the IRS.”
Also read: Living. After all, who is the 1st Law Program for?
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