China
Prepayment penalty
A fee the bank charges when you repay part or all of the loan early, as a percentage of the amount prepaid. The rate usually falls year by year.
How it works in Vietnam
In Vietnam the law does not set this fee; each bank’s loan contract does. It is usually highest in the first year, then drops year by year and may reach zero after a few years.
The calculator starts with a typical market schedule by loan year. Replace it with the rates your bank quotes to see the interest you save after the penalty.
Related terms
- Annuity / equal installments
A repayment method in which every monthly payment is the same amount, principal and interest together, as long as the rate stays the same.
- Declining balance
A repayment method: the same principal every month plus interest on what is still owed, so the first payment is the highest and each later one smaller.
- Loan term
The time you have to repay the loan in full, counted in months or years.
Learn more
- Vietnam home loan prepayment penalty: what to ask first
Paying down or paying off a Vietnamese home loan early usually costs a fee. How it is charged, how it falls over the years, and what to ask the bank.