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Credit Score: Cancel loan or pay off loan after one month

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shreddie_2
shreddie_2 Posts: 1 Newbie
in Loans
Hi all,

A couple of weeks ago I took a loan out with my bank for £5000 to purchase a second hand car. I then decided to buy a new car and have agreed a finance deal with the manufacturer. Now that I no longer need the bank loan (and I still have all the money), would it be better for my credit rating to pay back the loan with a months interest or should I simply cancel the loan which I can do within the first 30 days? I have only recently applied for credit after my past CCJ listing finally expired from my credit file and I'm now keen to re-establish a good credit rating.

Thanks in advance,

Shreddie.

Comments

  • jonesMUFCforever
    jonesMUFCforever Posts: 28,898 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    I think it would be cheaper for you to cancel within the 30 day limit.
    If you pay the money back manually you may be charged up to 2 month's interest as an early closure penalty.
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