I'm upset about this. I like to pay my loans off sooner, but the banks still like charge me more interest when I make a bigger payment. What is the use to pay more, when I feel like I'm getting rip off?
2006-10-13 04:21:38 · 4 answers · asked by Darrin S 1 in Business & Finance ➔ Other - Business & Finance
Does your loan have a pre-payment penalty? Is it calculated on simple interest, the rule of nines, or some other interest method?
If there is a pre-payment penalty, and interest is done any way besides simple interest, I'd look hard at refinancing. The prepayment penalty may make that more expensive, though. But any new loans should go through a different bank.
2006-10-13 04:24:57 · answer #1 · answered by Ralfcoder 7 · 0⤊ 0⤋
did u read the terms and conditions when you signed the papers. if u have a copy read them now. the amount u pay extra is a prepayment penalty. In india , it is 2% . i dont know where u r from. The logic goes like this: the money which is lent to you is expected to be paid over a fixed number of months (u call this installments) based on which Asset-Liability matching is already done. (it common parlance shall we say Cash flow statement?). when money is paid more than the expected level, this match is destabilised. hence the penalty.
2006-10-13 12:14:10 · answer #2 · answered by hariharan_hn 2 · 0⤊ 0⤋
Go to your bank and talk to one of the officers. Take documents with you.
2006-10-13 11:32:51 · answer #3 · answered by beez 7 · 0⤊ 0⤋
Because they're out to screw you!
2006-10-13 11:22:35 · answer #4 · answered by buff831 2 · 0⤊ 0⤋