should i pay the 3k debt while i can?

djdymond

hi everyone

i shall keep this as short as poss

basically we saved like mad to move into our first bought home, on the part rent part buy scheme.

even though we have some debt, we saved 10k for the deposit and all fees

we found it all fees and deposit have actually come to 6,600 leaving us 3,400

money in our current account takes it up to 6,500. the landlord should be giving us our deposit and 2 weeks rent back, totalling about 900 and we also have a fee refund due this week of 430, taking our money to over 7k

anyway. OH took our a 3k loan for a new car over a year ago. weve been paying 95 a month since then and because of interest, its not that much lower!! im thinking while we have the money in our account and to stop spending it on rubbish, clear the debt in one swoop. saving us all that money on interest, and freeing up 95 a month.

i think OH is a bit dubious about doing this, incase a bill or something crops up from the old flat and we need it. but it still leaves 4k in our account.

both our workplaces in total lent us 3,500 to cover fees for new flat at a time when my card had been cancelled and OH had been cloned and we were very short but this has now been sorted. the work places money is interest free and although neither of them are demanding money back, i would really like to give it back to them asap. again though, what with 4k in the account at the point, i could completley pay off OHs lend (2k) and then pay mine 1k, leaving 500 pounds left which i could pay next month

the more i think of doing all this, the more i want to do it.. or do we wait a month, just incase something does come up? (which i cant help but think is very unlikely?)

oh, incase it matters, i get paid on 26th, and OH on last thursday of the month... so its only 2 and a half weeks away. so even if i accidentally spent it all on debt and then something else came up, we wouldnt be skint for long.....

thanks in advance!

jellybean08

I'd pay off the car loan if i were you, that way you pay less interest and the 95 a month could go in an emergency fund. Do you have much left every month after bills etc? If not, then i'd keep a chunk of it for emergencies eg boiler breaking down etc...I'd also pay off one of the work loans, prob the biggest one. your one, can you pay it back in installments? or does it have to be 1.5k all in one go? It's much better not to have debts hanging over you and have a clean fresh start without leaving yourself stuck though.

debtfreesomeday

I'd definitely pay the loans off, your money is then your own.

Triggles

I don't know the details of a part rent/part buy scheme - but keep in mind that you may find some things in the flat that need repair that weren't obvious before. We just moved in July, and honestly the first 3 months we spent so much time getting things repaired that weren't obviously needing it when we first moved in - such as chimney stack needing repair, ceiling damage in 2 rooms that previous tenant managed to make much less obvious, and a number of other things.

Is there any type of penalty for paying off the loan early? I hate it when they have one, but worth checking out.

djdymond

thanks for the advice

the flat has been tested etc and i think if we found any probs this early on they would be reported and sorted out...

i will look into a penalty fee, just incase..

and as for our work loans, theyve not said "we want it back by such and such" but again as we have the cash, i just want to clear as much as poss.

as for our monthly bits and pieces, the bills currently total about 1,700 inc that 95 pound loan, leaving about 1,200 to ourselves which we do plan on saving as much as poss....

stapeley

IT A NO BRAINER. Get car paid off.

Silverbird

Definitely, definitely, definitely, definitely, definitely, definitely get the loan paid off.

Jesthar

Yup, this is an easy one - if it's costing you interest, then pay it off whilst you can!

djdymond

thanks silver bird

right im leaving at 4.30 today i dont know if ill get to the bank in time but ill give it a damn good try. otherwise itll have to wait till friday!