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Little advice please.

x_raphael_xx
Posts: 4,398 Forumite


As my loans are fixed payments, if I overpay they just take less the next month. So what I'm doing at the moment is saving spare cash onto my CC, bringing the interest down on it too, until I save up enough money to ask for a settlement figure from the loan and pay it off.
At the end of this month I will have £1000 saved. So do I...
1)Pay off HFC loan 1, which will have £1149 left to pay (will come down a bit for settling early) and is 28.5%
or 2)Pay off Bank of Scotland, which will have £972.18 to pay and is 17.9%, and would leave me a little in my CC.
I'm not sure if Bank of Scotland will lower amount for settling early and also as my CC is also 17.9% I dont think I would be better off debt wise, as I would have basically transfered debt to CC.
I was thinking of paying off HFC loan 1, but wanted to ask everyone else, incase I have missed something.
HFC loan 2 has £2226 left to pay (21.8%) so not thinking of that one at mo!
Also loan to friend is 0%, and shes happy with £50-£100 a month so I will tackle loans with interest 1st!
At the end of this month I will have £1000 saved. So do I...
1)Pay off HFC loan 1, which will have £1149 left to pay (will come down a bit for settling early) and is 28.5%
or 2)Pay off Bank of Scotland, which will have £972.18 to pay and is 17.9%, and would leave me a little in my CC.
I'm not sure if Bank of Scotland will lower amount for settling early and also as my CC is also 17.9% I dont think I would be better off debt wise, as I would have basically transfered debt to CC.
I was thinking of paying off HFC loan 1, but wanted to ask everyone else, incase I have missed something.
HFC loan 2 has £2226 left to pay (21.8%) so not thinking of that one at mo!
Also loan to friend is 0%, and shes happy with £50-£100 a month so I will tackle loans with interest 1st!
Debt Free as of 17/01/2009 Turtle Power!!
EF Challenger #3 £1543.72 / £5000
MFW 2024 #100 £1300.00 / £10,000
MFiT #40 Jan 2025 Target - £99,999.00
Mortgage at 30/09/22 £113,694.11 | Mortgage at 24/01/23 £110,707.87
Mortgage at 21/04/23 £107,701.01 | Mortgage at 20/07/23 £106,979.65
Mortgage at 04/10/23 £106,253.77 | Mortgage at 10/01/24 £105,324.57
Mortgage at 01/04/24 £104,424.73 | Mortgage at 01/10/24 £103,594.98
0
Comments
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Just a quickie - have you checked that neither of these loans has a penalty for early repayment? You say HFC loan 1 will come down a bit for settling early - how do you know this?Ex board guide. Signature now changed (if you know, you know).0
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May also be worth contacting both companies and asking if you are allowed to over pay? I do with my loan but its very hidden on how to do so.Save a life. Learn emergency first aid.
Who knows what might happen tomorrow or who may need help.
Contact your local college or first aid provider to enquire about free courses in your area.
Already a first aider? Have you updated your first aid to the new 2005 guidelines? Most providers should now be training the new (and more effective) CPR protocols, see if they are offering refresher courses near you.0 -
Wow, Im always surprised how quick people reply!
I've recently paid off another loan with HFC, so I know they adjust the interest if you settle early.
Theres also no penalties for overpaying with HFC, they just take less the next month.
I will need to check this with Bank of Scotland thouDebt Free as of 17/01/2009 Turtle Power!!
EF Challenger #3 £1543.72 / £5000
MFW 2024 #100 £1300.00 / £10,000
MFiT #40 Jan 2025 Target - £99,999.00
Mortgage at 30/09/22 £113,694.11 | Mortgage at 24/01/23 £110,707.87
Mortgage at 21/04/23 £107,701.01 | Mortgage at 20/07/23 £106,979.65
Mortgage at 04/10/23 £106,253.77 | Mortgage at 10/01/24 £105,324.57
Mortgage at 01/04/24 £104,424.73 | Mortgage at 01/10/24 £103,594.980 -
unfortunately it is not a very easy thing to calculate. the nominal interest rate 28.5% is no use in deciding where to pay early because the loan is not a flexible one.
you need to work out the following
a. how much will you pay off if you continue to full term
i.e. monthly payment x number of months left to pay
and
b. settlement figure if paid off now.
any saving due to early repayment is the difference between these two figures and the nominal interest rate doesn't come into it.
Where it is worth it depends upon how much interest you could have earned on the repayment amount or how much is saved by paying off the CC.
with CC the matter is different of course aa you get the benefits of repayments immediately.
ps. when you say you are saving on the CC, do you have a mechanism of withdrawing the money to pay the loans (balance transfer or whatever and is there a cost?)0 -
Just rang both parties,
Bank of Scotland gave me a settlement figure of £1033.31 (I miss calculated months left to repay!) Which includes the £153 interest rebate for settling early. The figure is valid until 30th Oct. And there are no penalties for early repayment.
HFC are idiots, I've had nothing but problems since I've been with them, won't go into details, but they even sent me someone elses paperwork once! Good job I'm honest.
Anyway, they won't give me a figure over the phone, because I can't prove who I am (even thou I have my name, birth date, address etc) I have to either send a letter in, or go into banch to see them. Guess I'll be making a trip into town then!
I will be paying from CC over the phone, so no high withdrawls or cheque interest.Debt Free as of 17/01/2009 Turtle Power!!
EF Challenger #3 £1543.72 / £5000
MFW 2024 #100 £1300.00 / £10,000
MFiT #40 Jan 2025 Target - £99,999.00
Mortgage at 30/09/22 £113,694.11 | Mortgage at 24/01/23 £110,707.87
Mortgage at 21/04/23 £107,701.01 | Mortgage at 20/07/23 £106,979.65
Mortgage at 04/10/23 £106,253.77 | Mortgage at 10/01/24 £105,324.57
Mortgage at 01/04/24 £104,424.73 | Mortgage at 01/10/24 £103,594.980 -
what is the monthly payment and how many months still to pay?0
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HFC ~ £85.64 a month, 26 months to go.
Bank of Scotland ~ £44.19 a month, 25 months to go.
Also, going thru my paper work, although HFC won't give me a settlement figure until I go into the branch, I asked for one in July.
To give you an idea, the amounts then were...
Amount before rebate = £1802.29
Severance rebate = £482.24
Settlement figure = £1320.05
Just to show you roughly what they will ask for.
I must also ring them both back and ask if they charge for paying with a credit card!Debt Free as of 17/01/2009 Turtle Power!!
EF Challenger #3 £1543.72 / £5000
MFW 2024 #100 £1300.00 / £10,000
MFiT #40 Jan 2025 Target - £99,999.00
Mortgage at 30/09/22 £113,694.11 | Mortgage at 24/01/23 £110,707.87
Mortgage at 21/04/23 £107,701.01 | Mortgage at 20/07/23 £106,979.65
Mortgage at 04/10/23 £106,253.77 | Mortgage at 10/01/24 £105,324.57
Mortgage at 01/04/24 £104,424.73 | Mortgage at 01/10/24 £103,594.980 -
Looking at the Bank of Scotland, you have got a settlement figure of £1033.31, or continue paying £44.19 x 25 months = 1104.75 - a difference of £71. (Have I got the figures right?) There doesn't seem much benefit in paying that one off if you are paying interest on borrowing on your credit card.
For HFC, in July you could have settled for £1320.05. That compares with 27 payments of £85.64 = £2312.28 (or possibly 28 payments?).
If I've got the figures right, it looks as if the choice is whether to pay the money to HFC or the credit card. Would you agree?0 -
tyllwyd figures seem correct to me and so the BoS early repay doesn't seem a good deal
however the HFC seems too good to be true ...is there a confusion between your two HFC loans?0 -
I'm sure I've got it right but I will take a trip into town and make sure I get it in writing from HFC.
I'd really like to finish that one too, as Ive been paying it off the the last 4 years (naively agreeing to HFCs claims that they could reduce my monthy payments at every 6 month overview, back then I didnt realise longer term x smaller payments = more debt) and the psychologically it would be fantastic to finally close the account.
Also as BoS has the same interest rate as my CC I dont think I will be that much better off, I will see if I can nip into town tomorrow and visit HFC for a figure and let you know.Debt Free as of 17/01/2009 Turtle Power!!
EF Challenger #3 £1543.72 / £5000
MFW 2024 #100 £1300.00 / £10,000
MFiT #40 Jan 2025 Target - £99,999.00
Mortgage at 30/09/22 £113,694.11 | Mortgage at 24/01/23 £110,707.87
Mortgage at 21/04/23 £107,701.01 | Mortgage at 20/07/23 £106,979.65
Mortgage at 04/10/23 £106,253.77 | Mortgage at 10/01/24 £105,324.57
Mortgage at 01/04/24 £104,424.73 | Mortgage at 01/10/24 £103,594.980
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