Repayment schedule
A repayment plan (also amortization plan ; English redemption plan ) is understood in banking as a list in tabular form of the future repayment amounts and loan interest together with the associated due dates for repayment loans .
General
With long-term loans , the borrower without a repayment plan has little overview of the future payments to be made by him. Repayment plans give structure and are the basic structure of any (long-term) presentation of financing . The customer can usually find his regular payment obligations from an independent interest and repayment plan. A repayment plan is used to increase transparency, especially with installment loans and annuity loans , in order to give the borrower an overview of the payments to be made by him. Due to a sufficiently detailed repayment plan, a cursory examination reveals that the interest rate for annuity loans does not change within a year despite the quarterly repayment installments. The repayment schedule is a series of payments that summarize the repayment and interest expenses:
| year | Remaining debt | interest | Repayment | Annuity |
|---|---|---|---|---|
| 1 | € 100,000 | € 5,000 | € 18,097 | € 23,097 |
| 2 | € 81,903 | € 4,095 | € 19,002 | € 23,097 |
| 3 | € 62,901 | € 3,145 | € 19,952 | € 23,097 |
| 4th | € 42,949 | € 2,147 | € 20,950 | € 23,097 |
| 5 | € 22,000 | € 1,100 | € 22,000 | € 23,100 |
| to hum | € 15,488 | € 100,000 | € 115,488 |
Legal issues
A repayment plan is for consumer loan agreements according to § 492 para. 3 sentence 2 BGB in conjunction with Art. 247 § 14 para. 1 BGB statutory mandatory part of the loan agreement clarified and must, under that provision, the payments owing and the periods do, and what conditions for this Payments apply. The amount of the partial payments on the loan, the interest calculated according to the borrowing rate and the other costs must be broken down. It must at least contain information about the frequency of interest and repayment, the amount of the interest and repayment installments and their due dates. Monthly , quarterly , half-yearly or (rarely) annual payments are possible as repayment frequency . The repayment rhythm specified in the repayment plan and the amount of the repayment installments cannot be unilaterally changed by the borrower, so that unscheduled repayments are not possible. Also indicate the interest rate ( nominal and effective ). The repayment plan is to be made available to the borrower on a permanent data carrier .
The (voluntary) creation of repayment plans by credit institutions is also provided for other long-term credit types ( investment loans , real estate loans , consumer loans or real estate financing ). The creation of a repayment plan is only possible if a fixed interest rate has been agreed, unless the repayment plan is limited to specifying the repayment installments.
shape
With the annuity loan , the repayment schedule reveals that the annuity remains constant while the loan interest to be raised falls in favor of the repayment portion. In the case of amortization loans, on the other hand, the annuity is degressive , while the repayment installments remain constant.
Bonds
Also bonds can in their loan terms include a repayment plan. Bonds with a fixed repayment schedule ( redemption bonds ) necessarily contain a termination clause, while bonds without a repayment schedule can provide for a termination agreement by the issuer .
