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Need a 7K loan, no redemption charge, anyone help please?

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JasonP
JasonP Posts: 31 Forumite
Hi,
I'm looking for a 7k loan (secured or unsecured), over as long as possible 5years+, with no redemption charge.

Reason: I need 7k to finish a property deal, in 2-3years I will refinance property and pay back loan.

I've found a couple loans, nationwide being the cheapest @ 7.6% but I dont understand the redemption charges etc, it baffles me, can anyone advise on loans with no redemption charge or help me work out how much they would charge?

Thank You,

Jason

Comments

  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
    10,000 Posts Combo Breaker
    redemption charge for unsecuredd loans are about two months interest .. not a lot really
  • Try egg. In the past I think there were no redemption charges.
    Don't lie, thieve, cheat or steal. The Government do not like the competition.
    The Lord Giveth and the Government Taketh Away.
    I'm sorry, I don't apologise. That's just the way I am. Homer (Simpson)
  • JasonP
    JasonP Posts: 31 Forumite
    Hi Clapton,

    So for a 7k loan @ 7.6%apr over 5 years, what would the charge be? how do you work it out?

    Thanks
  • If you put the loan details and the repayment details into this snowball calculator at https://www.makesenseofcards.com/snowball.aspx it will show you how much you pay in interest at each month. Just double whatever is the interest for the month that you pay back the balance in and double it. It won't be perfect but it will be ballpark.
    £34,547 (Dec 07); Current debt: £zilch (Debt free December 2010)
    Sealed Pot #389 (2010=£133)
  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
    10,000 Posts Combo Breaker
    at the beginning of the loan you owe 7,000
    so the early redemption penalty would be
    7000 x 7.6% x 2/12 = £88

    obviously as the months go by the capital sum you owe decreases so the early redemption penalty will decrease.
    so if you owed 6,000 then the sum would be £76
  • Rafter
    Rafter Posts: 3,850 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Think the post office and zopa are the only ones without early redemption fees now. Although with Zopa, the setup charge might offset the benefit and the post office rates are a bit higher than Nationwide.

    As Clapton says, I wouldn't worry too much - the maximum penalty is generally 1 month plus the month you are in by law and very large early repayment charges are now not allowed following a tightening up of the consumer credit rules a few years ago.

    Good luck

    R.
    Smile :), it makes people wonder what you have been up to.
  • JasonP
    JasonP Posts: 31 Forumite
    Thanks for the help guys, I think I'll go for any decent loan regardless of the redemption, :)
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