Lõppjärkus

Lõppjärkus is a term used in Estonian lending to denote the final installment on a loan or mortgage that fully settles the remaining balance. It marks the end of the loan’s amortization schedule and the completion of debt obligations between borrower and lender.

Characteristics and usage

- The final payment may be equal to a regular installment if the loan’s schedule aligns precisely, or it may be a distinct payoff amount calculated to cover any remaining principal plus accrued interest.

- In standard amortizing loans the final payment typically clears the last of the outstanding balance. In balloon or non-amortizing structures, the final payment can be substantially larger, reflecting the remaining principal that was not paid in prior installments.

- The exact amount is specified in the loan agreement and payoff statements issued by the lender. Borrowers should request a payoff quote to ensure accuracy before making the final payment.

Implications

- Upon paying the lõppjärkus in full, the borrower’s obligation to the lender ends, and the loan is considered repaid.

- For loans secured by collateral, such as a mortgage on real estate, the lender typically releases the lien after receiving the final payment and confirming repayment.

- Borrowers may need to obtain documentation or a release from the land register or mortgage registry to finalize ownership free of the lien.

Considerations

- Borrowers should verify the payoff amount with the lender, account for any fees or penalties, and allow processing time for the final settlement.

- Proper documentation and timely payment help avoid residual claims or complications related to the loan closure.

See also: amortization, loan payoff, mortgage, lien release.