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Since on average there are 3 loans per Russian citizen, we decided that IT specialists would also be interested in learning how to repay their loans and debts correctly and profitably.

Getting a loan is very easy, but paying off creditors is much more difficult. As practice shows, you can crawl out of the deepest financial hole if you don’t despair. Our tips and methods will help you pay off even large debts: pay off debt wisely, find money to pay, choose the best way payments.

How to pay off credit card debt

1. Conversation with creditors

Under no circumstances should you disappear, drop calls or ignore email notifications. As soon as you feel that the situation is critical and you will not be able to repay the loan on time, inform the lender about this. Please clarify that you are not going to deceive the bank, that you have been regularly paying the loan until specific circumstances arose, and that you are going to regularly pay the feasible amount. No one is interested in long term legal proceedings, on the contrary, they will probably meet you halfway.

You may be offered a reduction in interest rates for a while, or even a waiver of some late fees or a change in payment schedule. All this will help you move on, and, alternatively, your credit history will not suffer. Of course, you should stop using a credit card, fixing the debt so that it does not increase.

Advice:

Tell them you can't pay anymore.
Record the debt.
Try to soften the conditions.

The bank is no less interested in repaying the loan than you are. There are cases when banks can close a loan even at a loss, but this will not affect the client’s credit history in any way - a normal business process of cost management.

2. More than the minimum payment

Credit companies and banks love it when you pay exactly what you need. It seems to you that you are paying off the loan, albeit little by little, but in reality your debt is only increasing due to interest. If you pay at least a little more, it will be more profitable, as it will reduce payment terms. As a rule of thumb, approximately 10% of your income is spent on random things, so try to immediately deposit it into your credit account.

For example, let’s take a credit card with an exhausted credit limit of 100,000 rubles. The table of minimum payments for this amount will look something like this:

Months

1 month

2 month

3 month

4 month

5 month

6 month

7 month

8 month

9 month

10 month

11 month

12 month

Min. payment

RUB 12,083.33

RUB 10,875.00

RUB 9,787.50

RUB 8,808.75

RUB 7,927.88

RUB 7,135.09

RUB 6,421.58

RUB 5,779.42

RUB 5,201.48

RUB 4,681.33

RUB 4,213.20

RUB 3,791.88

Redemption

10,000 rub.

9000 rub.

8100 rub.

7290 rub.

6561 rub.

5904.90 rub.

RUB 5,314.41

RUB 4,782.97

RUB 4,304.67

RUB 3,874.20

RUB 3,486.78

RUB 3,138.11

Interest

2083.33 rub.

RUB 1,875.00

RUB 1,687.50

RUB 1,518.75

RUB 1,366.88

RUB 1,230.19

RUB 1,107.17

RUB 996.45

RUR 896.81

RUB 807.13

RUB 726.41

RUB 653.77

Credit body

100,000 rub.

90,000 rub.

81000 rub.

72900 rub.

65610 rub.

59049 rub.

RUB 53,144.10

RUB 47,829.69

RUB 43,046.72

RUR 38,742.05

RUB 34867.84

34864,78

As can be seen from the table, the minimum payment does not pay off the debt for one calendar year, as many believe

By the end of the year, you will only be able to pay 60,000-70,000, and interest will be charged on the remaining debt. In fact, the minimum payment is designed in such a way as to make your loan as long-term and profitable as possible for the bank. If the minimum payment is made even slightly late, all of it can be spent on paying off fines, interest on overpayments, penalties, and current interest. You will pay, but the debt will not decrease at all.

Advice:

To close the card in less than a year, make x1.5-2 minimum payments

3. Plan a budget

Surely there are things on which you spend more than necessary, believing that this minimum amount will not yield anything. What difference can a cup of coffee make when you need to pay off a car loan? It sounds naive, but write down all your expenses and you will see where you can save. It's not fancy, but even a small amount will be enough to cover the interest payments and also pay a little more than the minimum payment. This is exactly the money you spend on nonsense.

Advice:

Optimize your expenses

4. Try to increase your income and prioritize

There are no general tips here. Some people can take more working hours or days, others can work longer and get a bonus. Some earn money using their skills and hobbies. Take on any temporary work, look for part-time work, you need to improve your financial situation. If you have a car, get a job as a taxi driver. You can try selling unnecessary things. They can buy anything from you, from an old washing machine to a broken children's bicycle. Something that has been collecting dust on your balcony for years can bring you $20-$50. Already enough for the minimum payment.

If you are saving money for education, it may be worth spending it now by pushing your plans back for a year. If there are two cars in the family, you can sell one of them, so you will not only get a large sum, but you won’t spend money on gasoline, maintenance, or renting a garage. Ride on public transport more inconvenient, but cheaper. Try to give up hobbies and hobbies, this will free up a certain amount every month and allocate time for part-time work.

Advice:

Increase your cash: new income = new credit opportunities.

American methods of debt repayment

1. First of all - with the highest quoted rate

It would seem obvious, but many try to first pay off small loans in order to pay off at least part of it. In this case, you pay more interest for the service, so the total amount is higher. For example, you have one loan at 13% per annum, the second at 10%. If the loan amounts are the same, focus on paying off the 13 percent loan while paying the minimum payments on the other.
You will have to pay interest anyway, but this way you will make it less.

If the amounts are different, then it is necessary to bring interest rates into line with these amounts. Let's assume that we have two credit cards: Alfa Bank, with a debt of 100,000 at 25.9%, and Sberbank with a debt of 80 thousand at 19%. We bring the Sberbank rate to the Alfa Bank rate:
19*(100/80)=23.75%. That is, the main efforts must be made to repay the loan from Alfa Bank.
If we assume that the amount of debt in Alfa Bank is 50 thousand, then the given Sberbank rate will be 19 * (80/50) = 30.4%, which makes repayment of this debt paramount.

Advice:

Count your loans: pay off those that are profitable, not those that you want.

2. If the accruals on several loans are approximately equal

Reverse method: if you have several loans with equal charges, pay off the smallest one. This is the so-called “snowball method”: paying off one loan motivates you to pay off the next one, while you reduce their number. Most people find it easier this way, and they subconsciously lean toward this method. Please note that if you are facing confiscation or there is clearly more accrual on one of the loans, this method is excluded, pay off the larger loan as described above!

Advice:

If you have equal debts, try to close a specific loan

3. Restructuring and refinancing

If you took a large amount to develop a business or buy an apartment and paid off at least a third, you can ask for restructuring. It is beneficial if the bank now provides loans for the same purposes at lower interest rates. They may meet your needs, and you will receive not only a reduction in your total debt, but also an extension of the term on the new loan. That is, you can use restructuring to reduce your monthly payment by increasing the overall loan term. Restructuring makes sense when interest rates differ significantly, since you will have to pay commissions and some other fees when you apply, so carefully calculate the benefit.
By the way, not all banks agree to refinance own loans, so you can try to sell the loan to another bank. For example, VTB24 and Sberbank are engaged in refinancing mortgage loans. Raiffeisenbank can refinance both its own and others' car loans.

Advice:

If you can’t pay, restructure: restructuring will collect everything into one payment and reduce the monthly amount.

4. Repayment from another credit account

If you want to pay off a loan from another bank credit card on which you have no debt and have a certain amount that you can use, make sure that it is profitable. Even if you can use the amount at 0%, there are always fees associated with transfers, so you will lose some money, but at the same time increase the number of loans that you will have to pay off at the same time. If you choose this method, to calculate the amount, divide the debt by the number of months during which the interest-free loan is valid, and make sure that you have enough funds to repay.

Advice:

Avoid fines: use other loans if the situation requires.

Comparative table of American repayment methods:

Repayment method	Advantages	Flaws	When it suits
We pay off the loan with the highest accrual	Every month you will save more	You need to make every effort to pay high interest on the main loan and minimal payments on the rest	When it is important to save on interest, when there is a risk of property confiscation
We pay off the smallest loan	The number of credits decreases, you see the result	Not always profitable from a financial point of view, not suitable if the loans are not at least approximately equal in terms of accruals	When you need to at least start paying off loans and see that the result is achievable
Restructuring or refinancing	Allows you to save significantly if calculated correctly: extend the payment period, reduce the interest rate and monthly payments	Additional costs for re-issuing a loan and insurance. It makes no sense if the remaining payment period is short.	When the period of remaining payments is longer than the payments made, and the loan amount is quite large.
Repayment from another credit account	You save on interest, so you pay off your principal faster	The need to make monthly payments on an interest-free credit card on time.	When the term of the interest-free loan is long enough and you can pay this amount monthly

These simple techniques will help you avoid various unpleasant situations with loans. Loans are a very useful and correct tool that expands our capabilities, right attitude to loans is the key to success.

Many problem borrowers do not even suspect that they can take out a new loan to repay other loans they previously took and benefit from it. This becomes possible only in cases where the initial loan was issued at high interest rates. The main benefit is to reduce the total amount of overpayment on the “old” loan due to more favorable lending conditions on the new loan. In common parlance, this procedure is called, which can be carried out in two radically different ways.

First way. Take out another loan, with which you can repay the previous loan. For example, a client who has a debt on an express loan with an interest rate of 60% per annum can pay off the entire amount by taking out a new loan at 15%, providing some property as collateral.

As a result, interest will be recalculated and the old loan with high interest will be repaid early, and the client will then pay for a completely new loan on more favorable terms.

Positive sides. Savings happen Money on overpayments and a loan appears with a lower interest rate.

Negative sides. When applying for a new loan, banks do not take into account that the funds will be used to pay off other debt and, in most cases, refinancing is not welcomed. After all, it is not guaranteed that the money received under the new agreement will be used for early closure of an existing loan at the “old” bank.

When considering the application, the lender will understand that the client is taking out a second loan and will make payments simultaneously under two agreements. This fact negatively affects the approval rate, especially when both amounts are of an impressive size.

Helpful advice. Try to choose a loan with a minimum interest rate, which does not have additional fees, fines or insurance.

Second way. There is a special one that allows the borrower to take out a loan in order to repay another one. Usually it is provided by such large banks as VTB 24, Sberbank, Rosbank and some others. Using this program, it is possible to repay several loans at the same time, and it does not matter whether the loans were issued in different banks or in one.

How is loan refinancing carried out?

If you want to repay the loan with another loan, you must contact a bank that provides a service such as refinancing. The procedure for applying for it is no different from applying for a regular loan, which means that the applicant must provide a standard set of documents and fill out an application for the provision of this service.

You will need income certificates from your place of work, as well as from the bank that issued the initial loan, with characteristics of the loan being closed. The bank statement must include information about the interest rate, loan period, monthly payment amount, and the amount required for early repayment. In addition, the borrower should take all Bank details together with written confirmation that he faithfully fulfilled his payment obligations to the bank.

The bank will consider the application for some time, after which it will make an approving decision or refuse. If a positive response is received, the final phase of the refinancing procedure is carried out. The client signs the loan agreement, but the money is not given to him. The amount in the established amount is sent to the original lender and ensures early closure of the contract. The previous loan will be repaid, and the borrower acquires a newly concluded agreement and is obliged to pay only for it.

Positive sides. This procedure is official and is completed quite simply, especially if the client has a good credit history.

Negative sides. Most often, refinancing is carried out at a standard loan rate, so in the end the client receives a regular loan with the appropriate interest. For example, at the Savings Bank for a simple borrower this rate is 20.5% per annum.

Helpful advice. If you decide repay a loan with another loan, then be sure to study all the nuances and calculate all the possible benefits. Despite the fact that the rate of a new loan is noticeably lower, you can lose a lot when paying for insurance, commissions, and third-party services (for example, with a mortgage loan, you need to perform a real estate appraisal). Remember that refinancing should only be used if there is an obvious significant benefit, otherwise it will not bring you any savings.

Taking out a loan is quite easy, but paying it back is very tedious. The debt burden worries you and keeps you up at night; you want to pay it off as quickly as possible and breathe a sigh of relief. European banks provide loans at low interest rates, so no one has the desire to repay the loan ahead of schedule, but our compatriots are striving to free themselves from credit bondage due to too large overpayments. But is this always beneficial?

When applying for a loan, it is necessary not only to discuss the payment schedule, but also the conditions for early repayment, because it is possible that your financial situation will change for the better, you will be able to pay off all debts before the due date. Full repayment of the loan is possible only if the entire amount of debt is credited to the account along with interest for using the loan. And if the borrower does not have the required amount in full, but simply has the opportunity to pay a larger amount than agreed in the agreement or make payments ahead of schedule, then we're talking about about early repayment of the loan. It would seem that early repayment of a loan is beneficial not only to the borrower, who has paid off his debts and breathed a sigh of relief, but also to the bank, which will be able to invest these funds in other operations. But everything is not so simple: when repaying loans early, this is especially typical for mortgages, the bank incurs certain financial losses. For example, loan rates have decreased over this period, and the bank, instead of receiving high interest on loans, receives the entire amount of the debt ahead of schedule, and can offer a new loan to its clients on less favorable terms. This explains the fact that many loan agreements include a ban on early repayment of the loan or a requirement to pay certain compensation to the bank. Some banks (DeltaCredit, UralSib) allow early repayment of the loan after some time has passed after receiving it; it is also popular to include in the agreement a condition for early repayment without a commission of a certain minimum amount, as practiced, for example, by Vneshtorgbank.

If you repay a loan early, you must consult with a bank employee, otherwise you may experience unpleasant consequences. For example, many banks allow extraordinary repayments only after the borrower has submitted an advisory application and the bank committee has responded positively to it. Otherwise, the funds credited to the account will be debited only in the amount specified in the agreement, even if you paid a much larger amount. Moreover, some banks apply penalties for early loan repayment, which amount to up to 2% of the repayment amount. Therefore, if you decide to take such a step, calculate what is more profitable for you: diligently pay your fees according to the schedule or pay off the entire amount at once by paying a fine.

Before deciding to repay the loan early, you should take into account the following circumstance: if your agreement provides for the payment of all interest charges at once - during the first years of using the loan, and you only have to pay off the “body of the loan”, then does it make sense to repay this amount prematurely? ? In this case, you do not save your money, except that you receive moral satisfaction from the fact that the loan has been paid off and you will be financially free.

When applying for a loan, you should carefully study the clauses of the agreement, even those printed in fine print, in order to provide for all the conditions for repaying the loan. The ability to repay a loan early is very beneficial: you can reduce either the amount of regular payments or the loan repayment period. It is also possible to refinance with another bank on more favorable terms; all these circumstances should be remembered when going to the bank to enter into a loan agreement.

Monthly loan servicing costs have a negative impact on the family budget. As a result, the overpayment on the loan represents an impressive figure commensurate with the size of the debt obligation, therefore, if it is possible to repay the debt ahead of schedule, it is necessary to deposit the available money.

How to repay a loan early

When the debt is returned to the bank in excess of the amount of planned payments provided for in the schedule, the loan is reduced. The borrower gets the opportunity to save on interest payments. In this case, the lender loses his profit, which is equal to the benefit of the borrower, so previously banks charged a penalty for repaying the loan ahead of schedule to compensate for their losses.

After amendments to the Civil Code, the law prohibits the withholding of any commission when repaying borrowed funds ahead of schedule. There are two options for reducing borrowing costs. You can deposit funds before the agreed period for:

complete closure of the debt;
covering part of the debt.

Calculation of early mortgage repayment

The borrower incurs huge expenses on servicing the mortgage - its size is large, it is issued on a long period, so you need to pay off your debt faster. After making a decision on early repayment of money, the debtor must contact the bank branch and ask to calculate the early repayment of the mortgage - find out the balance of his debt and the amount of the next mortgage interest payments.

After this, you need to decide on the amount that can be deposited and whether it will be enough to fully or partially close the debt obligation. If there are insufficient funds to finally close the loan, it is necessary to recalculate the mortgage for early repayment and find out new schedule scheduled payments. It is not profitable for credit institutions for the debtor to repay the remaining loan or part of it prematurely, so it is necessary to find out whether there is a temporary moratorium or restrictions:

for minimum payments;
for the payment period.

How to repay a loan from Sberbank early

The bank provides its clients with the opportunity to pay off their debt in whole or in part ahead of schedule. To make an early repayment of a loan from Sberbank, you must write an application. It must contain the date the funds were deposited, the amount and account number from which the funds will be debited. Required condition is that the specified date must fall strictly on working days.

Early repayment of a loan at VTB 24

The bank provides the opportunity for borrowers to repay the loan early. There is a procedure for submitting an application:

for partial loan repayment - one business day before the date specified in information letter scheduled payment dates;
for full payment of the balance of debt - the day before the planned repayment date.

For partial repayment of the loan, the lender has set a minimum payment limit; it is indicated when drawing up the loan agreement. To determine how the remaining portion of the loan will be repaid, the client is offered to use the VTB 24 early repayment calculator. The borrower can choose one of the options and indicate it in the application:

reduce size monthly payments and maintain their number;
pay the same monthly installment and reduce the loan term.

How to repay a loan in full ahead of schedule

Full early repayment of the loan involves payment of the remaining balance of the debt and interest accrued at the time of repayment. Nuances:

Before paying your loan obligations, you need to find out from the credit inspector the exact amount of other charges: installments, late payments, fines.
A receipt for payment of the debt will be a guarantee that no unpleasant situations will arise in the future.
You should also ask for written confirmation that the loan has been repaid.

Partial early repayment of the loan

If there are insufficient funds to fully cover loan obligations, partial early repayment of the loan is possible. When paying part of the debt, the scheduled payment schedule is recalculated. How future monthly installments will be paid depends on the payment option specified in the loan agreement. Payments are distinguished:

differential;
annuity

With differential payments, the loan body is divided into equal components. The monthly installment consists of one installment plus interest on the loan. The advantage of this method of determining payments is a rapid reduction in debt and a smaller amount of overpayment on loan obligations. There is only one drawback - you need to pay large fees at the beginning. When paying part of the debt ahead of schedule, interest charges and the loan period are reduced.

Annuity premiums require equal monthly payments. The disadvantage of this method is the slow decrease in loan obligations and large overpayments. If you pay part of the debt ahead of schedule, the bank may offer to choose the option with:

reduction of planned monthly contributions;
reducing their number (loan period).

Conditions for early repayment of a loan at Sberbank

Bank borrowers are interested in whether it is possible to repay a consumer loan ahead of schedule. The financial institution does not provide for restrictions on paying the debt ahead of time, there are no established limits on minimum payments, or moratoriums. You must deposit a specified amount of money into a specific account on a specified date. Failure to comply with one of the conditions will cancel the application, and the debt will be written off according to the previous schedule.

How to arrange early loan repayment

When deciding to pay off your debt in full or in part, it is important to take into account all the legal aspects of the procedure for depositing money - you need to fill out all the documents correctly. Registration of early repayment of a loan requires a sequential series of actions:

Written notification to the financial institution of its intentions. A sample application can be obtained from a bank employee and drawn up correctly - indicate exact amount, which will be deposited into the account or card, and the date of its deposit.
To avoid troubles, you need to take into account this recommendation - be sure to register the application with the bank. After registration, the bank considers this application for at least three days (maximum five) and notifies the client of the decision.
It is advisable to deposit the recorded amount before the specified date so that it is guaranteed to be credited. If the amount of deposited funds deviates from the declared amount or if they are not available within the specified period, the amount of debt will not be reduced - the received funds will be used to cover the next payments, according to the schedule.

How to calculate the amount of early repayment of a loan

Any early repayment of the loan involves the receipt of a new schedule of planned payments. It is calculated by a loan specialist. With the differential method of payment, the accrual of monthly interest decreases, with the annuity method, the monthly amount of contributions becomes smaller or their number and crediting period decrease. Financial institutions provide an opportunity for self-calculation of contributions.

The advantage of annuity loan payments is simplicity. Knowing the constant amount of the payment, it is much easier for the borrower to plan a personal budget. How to repay such loans early?

The annuity loan repayment system, in which the amount of the monthly payment does not change throughout the entire loan period, came to us from the West, in currently is the most common on the Russian market.

The annuity payment consists of two amounts: part goes to pay interest on the loan, and the other goes to repay the debt. At the same time, at the beginning of the loan period, the payment is almost completely spent on paying interest, and the reduction in the amount of debt occurs very slowly, drop by drop. This ratio gradually shifts towards debt repayment: your debt decreases with each payment, and along with it, the interest that you owe to the bank.

At the same time, it is difficult to say for sure how long the borrower will pay mainly interest (rather than repay the debt): it depends on both the term of the loan and the rate. However, if we are talking about long-term loans (for example, a mortgage for 20-30 years), then repayment of the debt body in the monthly payment structure begins to prevail only in the last quarter of the loan term.

In other words, if you took out a loan for 20 years, then you will begin to actively repay the debt only in the last five years - before that you will mainly pay interest. And the higher the term or rate, the further this moment is delayed - for example, in the case of a loan for 30 years at 30% per annum, active repayment of the debt will begin only in the last 3 years.

Therefore, you can often hear the opinion that such a system is beneficial to banks: due to the fact that in the first payments there is practically no repayment of the debt itself, the borrower overpays in comparison with differentiated payments - when interest is charged on the balance of the principal debt, which is repaid in equal portions.

But it is overlooked important feature. The monthly annuity payment will always be less than the first payment according to a differentiated system. And this means that the annuity system allows the borrower to take out a larger loan, because banks look at the ratio of payment to the borrower’s income. Annuity payments actually increase the availability of credit products—especially large, long-term loans like mortgages.

Realizing that in the case of annuity payments, the borrower is forced to overpay more, many decide to at least partially repay the loan ahead of schedule. After this, the bank client is faced with a choice: reduce his monthly payment without changing the loan term, or, conversely, leave the payment at the same level, but close the loan faster.

Reducing the term of the loan seems the right decision: at least if you compare both of these options using a loan calculator, then the total overpayment by the borrower will be less in this case. This is, in principle, quite logical: the less we use credit, the less interest we pay. However, this is a wrong conclusion and in most cases it is much more profitable to reduce the monthly payment.

In this case, with the same time frame, we significantly reduce the risks of our own default. No one is stopping the borrower from continuing to pay the previous amount: part of it will go towards the obligatory payment, and with the help of the accumulated balance, the debt can be repaid ahead of schedule.

This will make both options equivalent from a mathematical point of view: the loan will be repaid on the same date, and the final overpayment will be the same. But the borrower will have a non-mathematical, but not at all illusory, advantage: freedom of maneuver. If his financial situation suddenly worsens, he will be able to reduce his monthly payments without negotiations with the bank.

You can look at these options from one more angle: by reducing the loan term, you save your future funds, and by reducing the monthly payment, you get free money today. When you take inflation into account, money now is more attractive than the same money in the future.

Finally, by reducing the payment rather than the loan term, you get the opportunity to invest your available funds, even at a higher rate. Such opportunities are rare. But we can recall the extremely high rates on deposits that banks offered at the beginning of 2015.

Finally, you need to remember that you should not always run and pay off your loan ahead of schedule when you have such an opportunity: sometimes, oddly enough, it is more profitable to leave everything as is. The purchasing power of money will fall, which means it makes sense today to spend free money on purchasing necessary goods.

In general, I recommend that every borrower use one of the many loan calculators and carefully consider their specific situation. As I said, the payment structure differs greatly depending on the term and rate of the loan, and the effect of early repayment depends not only on the amount, but also on the moment: the sooner you reduce your debt, the greater your gain.

Due to the abundance of unknown variables, it is extremely difficult to give any general tips: Each case must be considered individually. However, if you decide to repay the loan early, then reduce the payment, not the term - regardless of the parameters of your loan, this will be the most correct decision.

Evgeniy Slavnov financial analyst, consultant at Lighthouse, author of the financial blog your-mom.ru