Desire to be Debt Free

smsfrancis

Good advice, thank you. Especially like the squash idea! Double especially as I'm sat here with a bottle of Lucozade from Boots.. another £ gone..

Just wondering why you say to pay the credit card off first? I see that it would be quite an easy win as they're quite close in balances but it is 0% until Sept 2010 whereas the loan is 13.5% APR... ??

Thanks again

josephine82

Good point- I hadn't noticed the 0%- sorry.

Anyway, I think it feels easier to me to get rid of the credit card debt because you can make overpayments, and with the loan you may not be able to? You might want to check. With my halifax loan I couldn't.

Someone much more sensible will probably answer your question better than I can though!

jo

smsfrancis

No worries, thank you for taking the time!

But yes, to clarify to the next lovely person: 0% interest on CC until Sept 2010, and 57 days interest charged on early repayments.

I've had a stab at this and used the calculator on this site:

Annual interest of 13.5% means a monthly interest rate of 1.06%

Put this simply, every £100 that I over repay them, I really only pay £97.88 off of the loan? So if I paid them £1400 lump sum, they'd take £1370.32 off the loan... cost £30ish... but if I left that £1400 in the loan, it'd generate £189 of interest per year - potentially £800ish for the life of the loan...

Are my sums right?! *brain splodes* :eek:

dancingfairy

Hi :hello:. No idea about the loan thing - sorry. The plan in geneal sounds good though. Is it 0% on spending till Sep 2010? just checking it's not on balance transfers instead - would hate you to get stung.
Perhaps ask on the loans board or start a new thread on here called loan overpayment query? Usually they are difficult it not impossible to overpay which is why saving in an ISA until you can pay the thing off is the way to go.
Best of Luck
df

smsfrancis

0% is on purchases and balance transfers, but thanks for checking!

Loan allows over payments (lump sums) which don't reduce the term remaining of the loan but do reduce the monthly repayments thereafter (and resultant interest from being a lower balance!), which seems like a good thing as I expected some sort of charge on the money paid off.

When I get a moment, I'm going to buy sandwich supplies to save some more dough!

smsfrancis

After finding out about over payments, I paid £1169 off of my loan this morning! Woop woop!

Proud to have a strike through my original numbers in the signature hehe

(Land_of)_Maz

<maz wanders in.... lifts the cushions, looking for biscuits..... wanders off again>

smsfrancis

No biscuits here, m'dear...

I got a letter this morning from Natwest telling me that my repayments had been recalculated based on my recent overpayment. From £280 per month to £250. Which is nice!

I just hope they don't feel like sending me these each and every time that I over pay, as I switched my standing orders this week to direct my £25 a week away from the Cash ISA and into the Loan... could be a lot of letters. Poor trees!