Early Settlement of Personal Loan

mrsgluv

I want to take out a personal loan over around 84 months. However, it is my intention to pay this off some time next summer - the reason for the long period is to pay relatively low monthly payments until I am in a position to pay it off. I know most companies charge an early settlement penalty of a couple of months interest. My question is, when the loan company calculates the settlement figure is this just the capital borrowed plus whatever penalties they impose, less the payments made? Or, do they calculate it based on the total amount payable over the full term, plus the penalties, less payments made?

Robert_Sterling_3

Different loan companies have different terms and conditions so check the terms and conditions before signing up for a loan.  Ask what happens if the loan is terminated early.

Martinslovechild

Mrsgluv,

Can I suggest the Cahoot Flexible loan which, although a higher rate than competitors (6.9%) has the major benefit that the loan is completely flexible, i.e. you can overpay or completely pay it off at any time, but most importantly, without incurring any penalties or charges.