From a detachment when an existing loan by spoken, repayment or rescheduling will be deleted. The replacement by debt restructuring can usually be done very easily, but otherwise it often looks like the premature repayment of a loan. Sometimes it just turns out that the money is available with which an existing loan can be fully repaid. This is worthwhile because in the future no repayment and interest rates will have to be paid. But who wants to pay off a residual loan, this can not always be very easily. If, for example, an interest rate has been set and agreed with the lender for a certain period of time or the entire contract term, the bank must often be presented with a legitimate interest so that the loan agreement can be canceled prematurely. The reason that banks do not carry out early redemption is often that the money is lost through the lack of interest payments. Especially with real estate loans, there are various legitimate interests for a replacement.
Replacement – A loan is replaced, not repaid
Reason for a replacement can be, for example, if a property would like to resell, but this is not possible for economic reasons, because it must be free of burden and the necessary funds can not be applied in any other way. Furthermore, a divorce and the death of a relative are reasons if the livelihood can not be disputed without the sale of the property .
If the replacement is made for one of these reasons, the credit institution may demand a rescheduling decision from the borrower. This compensation offsets the profit which the bank escapes through the replacement, because the interest is not paid over the actually agreed period. Furthermore, it may also be the case that the lending rates have decreased since the loan was taken out. In that case, the bank can only re-lend the amount of money returned on unfavorable terms. This compensation can also be demanded by the bank if it is repaid by the borrower. If the balance of a loan or loan is paid prematurely, a fee may also be required from the bank for administrative expenses. Before a loan is canceled by a replacement, each borrower should seek advice from the relevant bank. It is also helpful to seek advice from the notary.