Special Repayment
A special repayment is an additional payment on the loan outside of regular installments, which reduces the remaining debt and thus the interest burden.
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Detailed Explanation
Special repayments allow borrowers to pay off their debts faster. They are particularly relevant for mortgages but can occur with all types of loans.
Advantages of special repayments: - Shortening of the loan term - Significant interest savings - Flexibility with financial windfalls
Typical arrangements: - Mortgage: 5-10% of the original loan amount annually - Consumer loan: Often fully repayable at any time - Car loan: Variable arrangements
Important points: - Check contractually agreed special repayment rights - Possible prepayment penalty if exceeded - Tax aspects (for rented properties) - Timing can affect interest savings
Calculation Formula
Interest savings = Special repayment amount × Interest rate × Remaining termPractical Example
With a loan at 3% interest and 15 years remaining, a special repayment of 10,000 EUR saves approximately 4,500 EUR in interest (simplified calculation).
Legal Basis
§500 BGB (Early repayment)