Expected reimbursement method of the mortgage loan by reducing the period

Pays the apartment in 10 years instead of 20

To the mortgage loan, the number 1 enemy is not the debt with the bank or the capital borrowed but but but The team composed of interest and period.

I present under the payment method of the apartment in 10 years instead of 20. This method is successfully applied in the first 5-7 years of the mortgage loan requested over 20 years. The credit for 30 years extends up to 10 years.

Some important notions:

What appears in a maturity of the credit:

• Capital – is the amount returned to the bank by our debt

• Interest: an annual percentage of the remaining balance to be returned to the bank. The price paid

• Administrative commissions – if present, there may be fixed amounts or annual / monthly percentage from the balance that remained to the bank. It is assumed that there are amounts generated by the monthly credit management.

• The two ways of reimbursement partially expected:

• With the reduction of the value of the monthly rate: we keep the credit period and reduce the amount paid monthly

• With the reduction of the period: we keep the same monthly rate and reduce the payment period

Which commissions are charged with the early reimbursement of the mortgage/real estate credit?

In case of mortgage/real estate loans, NOT There is a commission for early refund.

To a mortgage with a fixed and therefore variable period of interest, the early refund with the reduction of the period does not affect /decreases Period of fixed interest.

To apply the method it is essential to respect the recommendation of the decay of 25%, maximum 30%, from monthly income.

• In the early years of credit, if you read the maturity you will notice that the value of the capital repaid is very low, most of the value value is composed of interest;

For example, you will notice that at a rate of 2000 she, 1500-1700 is interest and capital 300-500 she. What is normal, at the beginning of the loan the debt is greater as such, the more interests are paid to the bank, the lower the debt that the interest decreases and the remuneration interests.

Be careful to be with the reduction of the period and not with the value.

When we refund expected to reduce the value of the rate, the impact is very small, precisely because we keep the long period in which the bank applies interests every year.

When we reimburse in advance with the reduction of the period, each additional amount will be cut by the capital of his neighbor of maturity.

Attention: it will not cut from the capital of the last months of the credit, but from the months immediately from the moment of payment.

The amount can be between 600 and 1000 you per month, depending on the value of the loan and the period. Or 1 month in addition to the capital. According to income.

• And so with each month paid, cut one or two more.

• Every 6 months ask for a new maturity from the bank to see how the value of the monthly capital has changed. Make sure to reimburse the amount.

• At a certain point, after a few years, the interest becomes inferior to the capital.

So it’s time to lower the rhythm or even stop the expected reimbursements and focus on other more profitable investments.

Important: ask the bank to add the mortgage to the online bank, so you can reimburse in advance. The more difficult, reimbursement is, the more difficult, the genre must go to the bank, the more difficult it is to put the process into practice.

Don’t hear the motivation to go through this process? Do you look difficult? Are you not disciplined?

Take yourself a few minutes a day and view all the things/holidays that you can have with the money that exempt from the interest. Or vice versa everything to lose by paying a huge interest when it could be otherwise.