By making use of the early repayment of the loan, the debtor can repay, partially or in full, his debt before the contractually established deadline.
The early repayment of the loan
The debtor can at any time avail himself of the right to early repayment of the loan, paying the residual debt and the interest accrued up to that time.
The loan contract relating to the granting of a personal loan may provide for the presence of a penalty payable by the debtor, equal to a maximum of 1% of the residual debt, if this is greater than 10,000 euros. The percentage drops to 0.5% if less than a year is left until the loan expires.
The penalty due cannot in any case exceed
The amount corresponding to the residual interest due to the creditor. In the case of loans of less than € 10,000, the credit institution cannot request any penalty. No penalties can be applied even in the case of subrogation of the loan.
The early repayment of the loan, even if only partially, allows the debtor to save on the interest due to the bank or the financial company that provided the loan.
In the event of partial repayment of the residual capital
The amortization plan must be recalculated, taking as a reference the new debt to be repaid and applying to it the interest rate provided by the parties for the residual duration.
In the event of a request for early repayment
The bank or finance company that provided the loan will provide the client with the extinction statement, that is to say the document indicating the amount of the residual debt and how much the interest and expenses amount to. due for contract closure. The same document contains the terms and instructions for making the payment.