Is there such a thing as a fixed payment secured loan that you can overpay?

megisabel

Im looking for a secured loan of 25k over 25 years with fixed payments but want the option to overpay to get it paid off faster when I am in a position to do it.

Any ideas?

regularsaver1

increase mortgage and take out a fixed rate? that allows overpayments

anitap

Be very careful !!!!!!! I was advised by my mortgage broker to move my £15,000 car loan to a coventry loan which would run alongside my mortgage. I declined as it was a 5 year term and was worried about changing to a 25 year term even though the breathing space would have been nice. When she mentioned it a 2nd time I began to consider but firstly I checked and double checked that I would be able to reduce it back to a 5year term or overpay on it at my convenience. This was confirmed on more than one occasion.

1 year later I contacted the Coventry to re arrange the loan back to a 5 year term and they refused, they told me I couldn't do it and neither could I overpay and that I was stuck with it for 25 years. Might I add that by now i had changed my car so in effect would be paying for a car I no longer had for 25 years !!!!! I carried on fighting and eventually was told that as the loan with interest was over £15,000 which is the maximum they would change it to for an unsecured loan I would have to return in 1 year when it would be below £15,000 and then they would re arrange the term..................so i waited.............and waited............and 12 months passed so I rang them (May 2006).

Guess what they said............no you can't change the term of this loan and neither can you overpay on it - I argued the toss and reminded them that I had just sat waiting for 12 months due to their advice but the answer was still no. Angry ???? doesn't come close. So I contacted the financial ombudsman (advise from this website) and they investigated the case. They came back and said that the coventry would allow me to overpay on my mortgage but not the loan and in effect this would be doing the same thing .....not from my point of view it wasnt the loan was for a car and however they tried to mash my head I wanted shut of it !!!!! They also informed me that the Coventry had offered £100 as a gesture of goodwill for me waiting 12 months. I said that this wasn't acceptable and that I wanted a seperate loan over 5 years or to be able to pay the loan off early. I asked for a second opinion from someone higher within the ombudsman service. They came back and again confirmed the above decision.

I then decided as a last ditch attempt to contact the cheif exec of the coventry building society - I bombarded him with all of the documents from start to this point (which was quite a thick document as you can imagine !!!) and told him what I wanted and should I not receive the right decision within 7 days I would go down the legal chanel. Low and behold I received a call yesterday saying I can now over pay on the loan - halleluhah !!!!!! His p.a then asked if I would accept the £100 but I said no, she went away and came back with an offer of £150 which I have accepted.

I pride myself in checking the small print and I had checked and double checked with my mortgage advisor.

It is always worth fighting on and although sometimes I feel like I do nothing but complain when I sit back and work out how much money I have saved or recouped from banks/insurers/loans etc over the years it is definately worth it !!!!!!!