Cheapest short term loan for £10k

working_mum_2

Hi All,
My retired mum-in-law is in the process of buying a property. She is £10k short of the agreed price, but will have this money in January when a bond matures. In the meantime, my husband and I have said that we will sort out the shortfall.(Partly out of the goodness of our hearts, and partly because she has been living with us for the last year...). Can anyone suggest the cheapest way of getting this cash for a short term period of around 3 months? Thanks in advance, working_mum.

grumbler

Hi

There is no point in looking for the cheapest loan for such short term. What you actually need is flexibility with overpayments (no early redemption fee). See, for example, this recent thread: Loans you can make overpayments on....

15lsp

what about putting it on credit card?

working_mum_2

Thanks for this. I thought about Credit Card, but my limit isn't high enough. Might look into the flexible loans. Have seen some normal loans, with no early redemption penalty (e.g. Northern Rock). Does this mean I would just pay the monthly repayments for a couple of months, and then be able to settle the £10k? Or would I still be hit with additional interest charges?

grumbler

working_mum wrote:

...Have seen some normal loans, with no early redemption penalty (e.g. Northern Rock). Does this mean I would just pay the monthly repayments for a couple of months, and then be able to settle the £10k? Or would I still be hit with additional interest charges?

Be careful. Many people believe, that Northern Rock loans can be repaid early without any loss. However, Northern Rock's explanation looks very obscure to me:

Can I make extra payments to my loan?
Yes you can make overpayments at any time. Your monthly payment will not reduce and the total amount of interest paid will remain the same unless you settle your loan in full. As overpayments reduce your outstanding balance, you may be able to pay the loan off earlier than expected as your loan term will reduce in line with any overpayments made. If you do pay off the loan early you may be entitled to a rebate of interest, which is calculated using the formulae prescribed by the Consumer Credit Act 1974.

:huh: