Welcome finance

Andyp2k2

i took out a loan in 2007 and it was for 1500 i was paying the monthly installmenst religiously and when i left my job , i missed 4 months of payments when i started back in my job i arranged to pay more each month to get the loan down when i went into the office they said that i still owe over a thousand pounds i have now got it down to just over 600 pounds , is there any way that i will have paid more than i needed to of as when i spoke to them they stated that every payment i make only 50 pounds comes off the loan and the other 70 pounds is interest could anyone help many thanks Andy

bigdave1973

You will end up paying more in the long run. This is because you have borrowed the money for longer ie up to 4 months longer for the first repayment you missed.

For example, if your interest repayments for £100 borrowed is 10 per month. If you payback £20 the first month, you're down to £90 capital. Interest on £90 is just £9, so you've just saved £1 per month.

In our case however you didn't pay the £20 in the first month so the 2nd, 3rd and 4th month you'll still be paying £10 interest (plus the interest on that interest). This will be owed on top of the missed capital too.

So Welcome's calculations that you have a lot of interest to pay does sound reasonable.

Hope this makes sense!

SmudgeUK

have they charged you ppi on this also, might be worth checking