Increasing a current loan or starting afresh?

skooldaze

Hi,

I've had a search but haven't come across this question before and hope you can help.

Currently I have a year left on a 5k loan which is £127 a month on 10%
Due to a few other things I'm looking to obtain another 5k loan and worked out its about £229 over 2 years.

I'm wondering if:

1) If its better to increase your loan with your current lender - if so:
do they generally offer you the same APR as before
do they tack it onto the same loan you have presently

2) Is it better to have two loans with two seperate places.

The current lender is alliance & leicester

Tixy

They don't generally offer you the same APR - chances are its likely to be a higher APR as overall risk has increased and in general loan rates have increased over the last few years (though of course it also depends on your personal circumstances and finances)

Depending on the lender if you are accepted they may treat it as a seperate loan or consolidate the old one into the new one.

If you need the new loan before you have finished paying the old one off then if you can afford to service them both for a year I would go for a seperate loan and I would try to find one that allows partial overpayments without penalty so that once the first loan is finished you can overpay the second loan.

paddyrg

Try zopa/ratesetter as you can repay as fast as you like