Settling LTSB loan

Superdan

Hi all,

I'm paying off what was a £5000 loan which I took out over 4 years about 2 and a half years ago. I've rang for a settlement today and they want to add a £60.60 settlement fee on top of the settlement amount.

My question is... I seem to remember someone posting on here that you could get around this making a large (almost all the remaining balance) overpayment (which I can make fees free) and then letting the final payment go out the next month. Does anyone know if this is correct or have any better ideas to get around the settlement fee??

Thanks

Dan

danandgeorgie

Hi Dan

I have 2 LTSB loans. I got settlement figures on both today and no mention was made of any fee. I would call again and speak to a supervisor who is empowered to waive all sorts of fees at his or her discretion.

Cheers

Dan

Superdan

thanks in fairness the girl on the phone advised going into the branch and they would probably 'sort it out'. I think the fees are specific to this loan. Don't know why! Its actually handled by a company called ISIS but branded up as a LTSB product. Anyone heard of this before?

asandwhen

Superdan wrote: »

Hi all,

I'm paying off what was a £5000 loan which I took out over 4 years about 2 and a half years ago. I've rang for a settlement today and they want to add a £60.60 settlement fee on top of the settlement amount.

My question is... I seem to remember someone posting on here that you could get around this making a large (almost all the remaining balance) overpayment (which I can make fees free) and then letting the final payment go out the next month. Does anyone know if this is correct or have any better ideas to get around the settlement fee??

Thanks

Dan

Yes this is true - I have done it a couple of times - Call again and ask for the current balance (not the settlement figure) then make an overpayment of the current balance minus 1 months payment. Let the last payment come out as normal.

jonesMUFCforever

danandgeorgie wrote: »

Hi Dan

I have 2 LTSB loans. I got settlement figures on both today and no mention was made of any fee. I would call again and speak to a supervisor who is empowered to waive all sorts of fees at his or her discretion.

Cheers

Dan

Nobody has the power to waive an early settlement fee.

However there are ways round it like paying the bulk of the loan off and letting the last payment by D/D go through.
There is no ESF on part repayments.

danandgeorgie

Hi
I am in a similar situation. I have 2 TSB loans and want to settle both. Is it advisable to let the FULL final payment come out of the direct debit or is it better to leave just a few pounds for the last payment.

I phoned TSB to ask them but I guess understandly, they said they wouldn't help me avoid the Settlement Fee which is £184 on one and I dread to think on the other!

Advice please?

Thanks

Dan:beer:

Xbigman

You should pay off all but one and a half months worth of payments, not just one month. I've done this several times with Lloyds with no problems.
I've heard of one instance where a work colleague got a settlement figure and a balance remaining figure. They paid off all but one months payments. They then recieved a letter saying they had not paid the full settlement figure and had to send the rest (including the full settlement fee). The lenders argument (1st National) was that any overpayment during the period the settlement figure was valid for THAT WOULD CLEAR THE LOAN DURING THE SETTLEMENT FIGURES VALID LIFE would come off the settlement figure and not the balance.

A bit technical, but I've been wary of this ever since. For the few pounds extra interest it costs its not worth risking it.
Regards



X

PS I also wouldn't trust Lloyds online banking to give an accurate remaining balance figure. Mine was a bit changeable, which I think was an issue with the figures not updating very quickly.