Taking a bank loan is a big obligation that involves the payment of various types of commissions, initial fees and insurance premiums. However, not everyone knows that these additional fees are refundable after earlier repayment.

Earlier loan repayment is an option to settle your debt before the pre-determined date. Early repayment can apply to both a bank loan and e.g. online loan companies.

We repay the loan early in the same way that we would transfer money to the lender for the next installment. We will need our loan number as well as the lender’s special account number. It is worth to find out if it is free before making a decision on early repayment. Such information should be obtained at the time of applying for a loan, which is why it is worth looking into the signed loan agreement. After paying off the consumer loan, the lender should pay us back the commission and interest for the unused credit time.

The amount of commission on earlier repayment

The amount of commission on earlier repayment

In many banks as well as non-bank institutions there is a possibility of early repayment of the loan. This is a good option for those who want to get rid of debt. Unfortunately, such an operation does not pay off for every borrower. Its profitability depends on how many installments have already been repaid and on what terms the loan was granted.

Early repayment of the debt at the bank gives the borrower the right to receive a refund of part of the preparation fees and commissions. A person who repays the loan earlier can apply for a refund of part of the commission, which is charged immediately after the loan is disbursed. The amount of commission varies depending on the period during which the benefit would be met within the period specified in the contract. The commission for early repayment of the loan cannot be more than 1% of the repaid part of the loan, if the period between the loan repayment date and its repayment date is one year. However, when this period is shorter than one year, the maximum amount of commission can be 0.5%.

For example, if you have a loan for 10 years and want to pay back after 5 years, then you can apply for a refund for these 5 years, so almost half of the commission the bank took from you.

Non-bank loans have no commission

Non-bank loans have no commission

Many non-bank companies offer the first loan for free. The loan for free relates primarily to the offer of payday loans, i.e. short-term loans usually granted for 30 days or a maximum of 61 days. A free loan is characterized by the fact that the customer, when taking out the first loan, gives back the same amount that he got to the bank account. Cash loans offered by non-bank loan companies are known for the promotion available only to new customers, i.e. the situation in which the first online loan is granted for free. For free, it really means a cash benefit without any additional costs. Therefore, the borrower does not charge any commission for the loan granted. The first loan for free is a good solution for people who want a low loan amount with short-term repayment.