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Allowing Customers to Prepay Consumer Loans?

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Are there regulations or risk issues allowing customers to prepay consumer loans? I know that there is a risk of extecsions for installment loans, but need to know how many months in advance a customer can prepay installments rather than adding excess payment amount to principal?

It all comes down to your loan contract as to how excess payments are applied, how that impacts the remainder of the contract, whether there is a penalty for prepayment, etc..

First published on 01/03/2021

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