what to pay off next?

JAMIEDODGER

helloee,

i have debt totalling £6303. i have £500 coming my way this month.....

debts are..loan1: 4114 balance 14.9% no penalty for early repayment no ppi, i pay 116.26 minimum payment per month and the loan normally decreases by about 65 quid.

loan 2 : balance 288....not sure of interest rate but monthly payment is 12 quid and it usually decreases by about £7/8 pound.

overdraft 1900 9.9% i pay whatever i can off.

any suggestions what i should use the 500 to pay?

wigginsmum

I think I'd pay off loan 2 completely so it's gone, and use the rest towards the overdraft, getting the overdraft limit reduced accordingly so you can't spend it up again.

$17mma

Ooh good for you jamiedodgerWell the say you should pay the one with the highest rate first...

Kevicho

From a purely saving on interest point of view I would go for paying off the highest loan every time.

However that 288 loan is a niggly little annoyance and would be nice to be exterminated

Also if you put against the overdraft you have the option of having that in reserve in case of emergencies

Its a case of emotions vs cold hard logic here

lynzpower

Im on the emotions side here Jamie, get rid of the loan 2 and then the rest off the OD.

Your getting there :j

JAMIEDODGER

well ive just spoken to the bank and it seems i cant make capital repayments on this loan......so paying loan 1 back is impossible

piglet6

I'm with the majority - pay off loan 2, just for the satisfaction of seeing it "gone" :j and then put the rest to the overdraft.

Mind you, given what you've said about loan 1 on your last post, thats probably made your decision for you anyway!!;)

Good luck with whichever way you decide - I think you're doing a great job with clearing your debts... :T

Piglet

elantan

looks like it will deff be loan two then and a bit to o/d ..taking all decisions outof your hand ..good luck actually getting the money into the accounts ..that's the bit i really struggle with lol ..good luck

GreenFingers_2

I would do the following if it were me.... hooray... how wonderful... :T

1. Clear Loan 2 - A great boost to morale to see it gone - done and dusted - hooray... :j

2. Put the balance of the £500 towards Loan 1 - a big reduction and a big step forward - hooray... :j

onestep

Right well.. I was with Greenfingers, clear loan 2 (big boost to get rid of one!!) and then do loan 1, but seeing as you can't - it'll have to be the overdraft then!

getting rid of loan 2 will feel fab!!

onestep

beanielou

hi jd
clear loan 2 & pay off part of OD as well.
Way to go girl!!