Really appreciate advice Re; loan

Oli's_mum

Hi, I am looking to repay an existing loan which is linked to my hubbys business (the business does no longer bring in enough money to cover the business loan, so we will be scraping the money out of our current account!)

This is a really daft question but my hubby is determined to take out the barclays loan as it includes a 6 month payment holiday:

This is the barclays loan they have offered us:
£7150 over 6yrs 6mths £193.73pm 13.5% Total payable £10,461.42!!!
6 month payment holiday from when we take it out. Hubby reckons we can just take this out then repay the loan after 6 months with a better deal and there are no penalties to pay except a £125 fee.

Moneyback(?) through Alliance & Leciester
£7,150 over 6yrs 6mths £147.56pm 5.7% Total repayable £7968.24
unable to find out if there are any penalties, but to be honest it is very unlikely we can repay if before the term is up.

The existing monthly payment is £277pm through Barclays, hubby reckons there is about 2 years left of this loan, but he also needs to borrow an extra £2500 to repay his business overdraft. Otherwise, I would rather just be mega skint for the next 2 years, but there is no telling him!

Any advice on how to win him round would be really appreciated!!

Please help someone??

Many thanks

Oli's mum

fatbelly

Oli's_mum wrote:

This is the barclays loan they have offered us:
£7150 over 6yrs 6mths £193.73pm 13.5% Total payable £10,461.42!!!
6 month payment holiday from when we take it out. Hubby reckons we can just take this out then repay the loan after 6 months with a better deal and there are no penalties to pay except a £125 fee.

Quote from Barclayloan site:

"Optional up-front capital and interest repayment holiday for six months immediately after you receive your loan (Interest will accrue during this period and will be included within your subsequent repayments.) "

So you'll have a £125 fee AND 13.5% interest to pay at the end of the six months. Doesn't sound like a very good idea to me.

tom188

loan holidays only mean a break from paying, not a break from charging interest.

Robert_Sterling

I think this is worth repeating

Loan holidays only mean a break from paying, not a break from charging interest

Oli's_mum

Thanks to you both, good advice,I will aproach hubby again when and if an approval come through from loan application with Moneyback (their 48rs has expired!)

At least he will think I am the clever one quoting from the website!

Thanks again:beer: