How do you value your loans?

Lemon_Tree

Hi, i know it doesn't really make too much difference in the long run, but when you are making a list of your debts, when it comes to loans do you work on the original value of the loan or do you multiply your payment by the outstanding months?
In the long run i know it's not going to make much difference but just wondered how everyone else does it
Lem

jessicamb

Personally mine is based on the total amount owed less the amount paid but that isnt strictly correct - as any overpayments would bring the total amount owed down as less interest is payable.

I dont have that problem though as I'm not making overpayments at the moment :rolleyes:

Lemon_Tree

I'm not over paying either at the moment. The only reason i ask is that i had a flexible loan which i just put in at the value showed on line (exc interest) but have swapped to a fixed loan, at a cheaper interest rate and i know it will get smaller and never go up again like the flexible one used to.
Lem

Mrs_Sparkle

I base mine on the total amount owed including interest (the orginal loan was "only" for £16K). Obviously the total will go down faster if I manage to make a few overpayments, something I'm struggling with at the moment!

MinnieSpender

I put all mine on a spreadsheet and list the payment dates and amount paid as I go along. The spreadsheet then calculates what I still owe. Any overpayments are thrown at the lowest debt first (I managed to get interest stopped on the two biggest and the third is a CC which will be paid off next payday).

moozie_2

I had done this calculation very wrong at the beginning of my debt free journey even though I had received some excellent advice on here. I just hadn't got my head around it :mad:

The best way to do it is to ring the company and ask for a settlement figure. If you add that figure to the other outstanding debts, that is your total debt.

Then if you divide the settlement figure by the number of months you have left to pay it (say you took out a 44 month loan and you've paid 14 months, you have 30 payments left without any overpayments etc), that is the amount that your debt is reducing by every month.

So, if your settlement figure is £3000 and you have 30 payments left, your loan is reducing by £100 a month (even though you may be paying £150).

Hope this makes some sense

never_again_2

I called Tesco and Sainsbury (not A&L because the interest rate is the lowest and will be paid of next year anyway before I can snowball it). I asked for the amount I owe now and the interest rate, then I used the snowball calculator, which adds the interest each month and then deducts the payment, so each month I know exactly how much I owe (as accurately as it can be done anyway) - I update my signature with the snowball figures. I don't need to worry about the over payments because I have decided to invest all my overpayment funds into Premium Bonds, then clear the loans when I have enough to pay them outright - not exactly MSE correct, but I feel more comfortable doing it this way.

Jaymz

I find the best way is to ring them and get the settlement figure, I do this every so often. Or another way is to use MS Money as it calculates it for you

mrs_mug_2

I called and got a settlement figure. But now that has left me with a quandry. The settlement figure takes in to account an interest rebated of £845. Do I take the figure I owe today or the settlement figure?