Two Loan Questions!

southernscouser

Please stay with me as I'm about to confuse myself!

1) I have got a loan that was £25,000 over 84 months at 6.7%, paying £297.62 off the loan and £73.95 off the interest. £371.57 all together. I have another 58 months to go on it. Now when calculating how much debt I'm in shall I work it out as 58 months x £297.62 or 58 months x £371.57.

When working out credit card debt I don't include future interest only the current balance. Should I do the same with the loan or work it out with the interest?

Also, if I were to phone up my loan company (Tesco) and ask them if they could reduce my limit to their current rate, 6.3%, would they have to do another credit check IF they did agree to it?

Apologies if your head is as sore as mine! :rotfl:

johannamse

What I used to do, when I had a loan was to include the "settlement figure" in my "total debt" calculations. This is just an idea...may not suit you.

frugglewump

I would use the current balance of the loan - my reasoning is basically that although the interest exists i deduct it from the repayment rather than adding it to the balance and it's the balance which is the debt.

Can't answer the credit check as cahoot have always said No (or even NO!!!!)

southernscouser

johannamse wrote:

What I used to do, when I had a loan was to include the "settlement figure" in my "total debt" calculations. This is just an idea...may not suit you.

Well although it makes no actual difference to what I owe it just looks less on paper. Obviously though, rather than my loan going down by £371.57 a month it will go down by £297.62 a month!