When you decide to apply for a loan , in addition to evaluating the expense items associated with opening and managing the loan, you will also need to consider the amount of the installment . Requesting the calculation of the loan installment before signing the contract, will allow you to understand if you will be able to support the repayment plan provided by the body providing the liquidity. Among the other things that you will need to evaluate in advance is also the simulation in the event of the loan being extinguished , useful for understanding what the procedures and any costs to be incurred are.
What to evaluate before submitting the request?
As we said, before signing any loan agreement it is always advisable to know all the items of expense and the procedures adopted by the credit institution both in the event of early repayment of the loan, and in the event of delays or non-payment of one or more installments . In this article we will deal specifically with the early repayment of the loan, the procedures to be followed to request it and any costs to be incurred.
Paying off a debt with respect to the term agreed with the bank offers the great advantage of saving on interest rates . In fact, although the law allows the debt to be extinguished at any time, the advantages associated with this type of transaction are greater if you decide to intervene in the first months / years of the loan . Extinguish the debt when there are only a few installments left, and in the end there are almost zero benefits.
The amortization plan envisaged by most Italian banks – called the French one – initially provides for the payment of interest, which will prevail over the share of capital required, especially in the first installments of the loan. For this reason we advise you to carry out a simulation before requesting the extinction of the loan, only in this way you will be able to know the amount of the residual debt and the overall savings obtained.
Remember that if you decide to partially extinguish the loan you can choose between two possible solutions:
– the first, to reduce the duration of the loan, leaving the amount of the installment unchanged;
– the second, reduce the amount of the installment without changing the loan term.
Another factor that you will not have to forget to evaluate before submitting your request concerns the possible application of extra costs , or penalties . In this regard it should be noted that thanks to the Bersani Decree an important measure was introduced to protect savers. The provision establishes that all loans and mortgages opened after February 2, 2007 for the purchase or renovation of a building are exempt from penalties in the event of early repayment of the debt.
For all other types of financing, penalties are instead provided for in the manner established by the chosen credit institution and expressed in the prospectus as well as in the contract, which however can never exceed the amount of residual interest . Remember that there are particular insurance coverage that, if signed at the time of signing the contract, can protect you from the risk of any type of penalty.