help with "rule of 78" loan calculation?

Blessing_2

Thanks for the good work on this site. Please could you help me calculate what the early redemption figure on this loan will be:

Lender: Black Horse
Amount: £25000
Interest: 9.7% annual
Total Charge for Credit: £13472.00
Total Amount Payable: £38472.00
Repayments: £320.60 / Month
Term of loan: 120 Months to end 2014

Payment Protection Plan
Amount: £12800
Interest: 9.7% annual
Total Charge for Credit: £6897.53
Total Amount Payable: £19698
Repayments: £164.15 / Month
Term of loan: 120 Months to end 2014

We have repaid 20 months
Loan was taken out Dec 2004

dsouter_2

hi i took out loan with ltsb i wrote them a letter to cancel my ppi i recieved a letter back and they refused they said i could take out another loan and i would not have to pay ppii think this is a waste of timeas i think it adds more money on my loan any advice would be welcome

nomoneytoday

The 1+1 formula is simply a maximum of 2 months interest on an early settled loan, i.e. the months interest you would ordinarily pay plus the next month, instead of the complication formula that has been cut and pasted all over this forum..

itsmeandonlyme

Debt_Free_Chick wrote:

I have a (crude) spreadsheet set up to calculate this.

If you can let me have the amount of interest added to the loan & the monthly instalment from the agreement I can give you a rough figure.

Just to be clear, I need

Amount borrowed
Amount of interest added
Term of loan
Monthly repayment

I assume he did not take the payment protection insurance? If he did, I need the amount of the premium and the interest added to that, too.


Cheers

Hello,
Can anyone help me to get the ammount i shoul claim for Mis-sold PPI and Healthcare? or guide me to the right spreadsheet?

Amount borrowed 3000
Amount of interest added 1146.36
Term of loan 36 month
Monthly repayment 193.35

Rule 78


Hope it would help...
Loan intrest 44.5%
PPi-996.36
healthcare 150
Intrest on PPI 3%
36 month of repayments
193.35 in a month
PPi ccancellation charge £24
Return payment £22 and £2.88




Thank you so much


regards,

maria

moneybackplease

http://www.hughchou.org/calc/rule78.cgi

thought this might be of interest to some people to see how much interest might be discounted if paying off a loan early

Max999_2

Hi

I need some help.

I currently have an outstanding balance of £4930.40 , at 8.9% rate. My next payment is due on june 27th, and I want to settle at the end of October. Monthly repayment £308

Loan Taken was £15000 with HSBC for 60 Months, I want to settle on the 49th Month. Loan started sept 2004

Can anybody give a clue of the settlement figure at the end of October.


Thanks

Max

marshallka

Max999 wrote: »

Hi

I need some help.

I currently have an outstanding balance of £4930.40 , at 8.9% rate. My next payment is due on june 27th, and I want to settle at the end of October. Monthly repayment £308

Loan Taken was £15000 with HSBC for 60 Months, I want to settle on the 49th Month. Loan started sept 2004

Can anybody give a clue of the settlement figure at the end of October.


Thanks

Max

On your ageement at the back it should say early settlement in line with CCA 1983. If it does then rule 78 will be used most probably and it will hurt.

Here is a simple calculator to do the work

http://www.hughchou.org/calc/rule78.cgi

Max999_2

marshallka wrote: »

On your ageement at the back it should say early settlement in line with CCA 1983. If it does then rule 78 will be used most probably and it will hurt.

Here is a simple calculator to do the work

http://www.hughchou.org/calc/rule78.cgi

HI


Thanks for your reply, I have checked the agreement, and there is no mention of CCA1983 only credit act 74!!!!! . I will go to HSBC tomorrow to enquire about the settlement figure



Thanks

Max

warren78_2

OK - so if you have a settlement figure in line with the rule of 78 calculation but there is no clear reference to it in the contract, what does this mean?

I have a loan with Tesco from 2006 and the Credit Agreement refers to the Consumer Credit Act 1974, and in the 'Right to Settle Early' section, has the following text:

'You have the right to repay the Loan before the end of the term by making a single payment calculated under a formula which limits the amount of the Total Charge you pay. The amount that you would have to pay if, for example, you wanted to settle when a quarter of the Term of the Credit had passed would be £13,503.96, if half of the Term had passed the amount would be £9818.49 and if three quarters of the Term had passed the amount would be £5319.17. In calculating the amounts shown the assumption is made that all Installment Repayments due are paid on time and no default interest or charges are incurred. The amounts shown are accordingly only illustrative.'

CLAPTON

warren78 wrote: »

OK - so if you have a settlement figure in line with the rule of 78 calculation but there is no clear reference to it in the contract, what does this mean?

I have a loan with Tesco from 2006 and the Credit Agreement refers to the Consumer Credit Act 1974, and in the 'Right to Settle Early' section, has the following text:

'You have the right to repay the Loan before the end of the term by making a single payment calculated under a formula which limits the amount of the Total Charge you pay. The amount that you would have to pay if, for example, you wanted to settle when a quarter of the Term of the Credit had passed would be £13,503.96, if half of the Term had passed the amount would be £9818.49 and if three quarters of the Term had passed the amount would be £5319.17. In calculating the amounts shown the assumption is made that all Installment Repayments due are paid on time and no default interest or charges are incurred. The amounts shown are accordingly only illustrative.'

this has nothing to do with the rule of 78 which was effectively abolished in 2005
your loan uses the current rule and is basically the rule used for mortgages and all loans now.