Hi There, i m an ex-banker, let me guide you the proper way, you have a few option:
1) Re-structure the loan, you can call your bank / walk in to any branch, request for a loan restructuring form, pick the loan tenure option, write your request, it will took 2 week for bank to process and will update u via phone/ mail / email, depends on your choice of communication, usually the servicing branch / home branch of your loan will contact u on this or you can check with the bank before next installment.
2) Without altering your loan package, continue to pay Pre-payment, NOT Advance payment. Prepayment will offset your principal and you CANNOT withdraw back the money you pay, your usual installment will remain same but you can opt to pay the extra into Prepayment, please indicate to your bank, usually Over The Counter, or in your online banking (if your bank having this feature), your extra payment is prepayment and usually its in the round up of thousand, ie 10K, 12K etc. not odd figure of 10,018 etc.
3) Paying extra ie installment amount + extra amount without telling the bank will auto define by bank that your extra will park under Advance Payment, which DID NOT reduce your principal amount, but reduce the interest based on principal balance - extra payment x interest. Advance payment allow you to withdraw later if u need that cash with a processing fee. MBB charge RM 25 if not mistaken.
*Do note that both prepayment & advance payment did reduce your interest, however, some bank will only start reducing interest if your advance payment is more than X month of your installment.
4) Refinancing. This will move u from bank A to bank B with a fresh loan package according to whatever tenure u like / approved based on your eligibility. However, this will involved additional cost of legal fee & stamp duty & valuation report fee. Not recommended unless your current package is much higher interest compare to current market offering.
I hope the above give u some guideline.
*All 4 option above in the end will shorten your loan tenure.
and i m not agent / banker now i dont do any loan / referring.
Thank you so much for your feedback.
I guess restructure loan would be the best option for me.