Lloyds tsb loan - early settlement query

supersaver09

I took out a £1,500 Personal Loan with LloysdTSB in Jan of this year (Repayments started in Feb).
The total loan repayment to pay back over a period of 2 Years is £1,763.
But i'd like to Repay the Loan in full (balance is currently £1,326 not including the interest).

The APR is 17.2%.

What i'd like to know is:
What will the Early settlement charge be? i.e equivalent to 58 days interest of what's left on the Loan?

Thanks for all replies.

Mags_cat

supersaver09 wrote: »

I took out a £1,500 Personal Loan with LloysdTSB in Jan of this year (Repayments started in Feb).
The total loan repayment to pay back over a period of 2 Years is £1,763.
But i'd like to Repay the Loan in full (balance is currently £1,354 not including the interest).

The APR is 17.2%.

What i'd like to know is:
What will the Early settlement charge be? i.e equivalent to 58 days interest of what's left on the Loan?

Thanks for all replies.

I had a loan from Lloyds to buy my last car.

I was paying £268 a month by DD. I was able to make extra SO payments (another £300/month) until the balance was less than one month's DD payment. Then they just took the last payment by DD and there were no early repayment charges. It was paid off in half the term, too.

You might be able to do something similar and avoid the charge? Check the Ts&Cs.

jonesMUFCforever

The early settlement charge will be 58 days interest on the outstanding amount now.

ViolaLass

Nicholas_J._White wrote: »

Why do you want to pay it all back now anyway? If you have the funds to spare, why not invest it in suitable stocks/shares and hope that any dividends offset the interest on the loans?

It would take quite some skill and/or luck to beat 17.2%.

telboyo

here a few options:
1.Call them
2.or just default and they will give you a figure soon enough
3.get a consolidation loan and then spend the rest of your waking hrs finding a loophole for not paying it
4. stop gloating

supersaver09

I'd love to be able to put the money to "better use" but it's part of a top up of an existing Loan with another Bank. (So certainly no gloating from me! ).

Another thing i was contemplating, is paying off chunks of the Loan i.e £300 or £400 for a couple of months - (similar to what Mags-Cat said) then in effect pay 58 days interest on a much lower balance (?)

tehwolf

Check your T's & C's about overpayment.. I had a LTSB personal loan some time ago, a friendly lloyds bank manager told me that (using your numbers as an example..) if i were to pay £1300 as an overpayment, then i would be charged 58 days interest on the remaining balance, i.e. £54, when subsequently settling it in full.

in other words, settle as much of it as you can afford to whilst still leaving a nominal balance, then settle the loan in full in a separate transaction. assuming the terms were similar/the same as the ones i had, you will only be charged an interest penalty on the nominal sum and not the entire £1354.

supersaver09

tehwolf wrote: »

Check your T's & C's about overpayment.. I had a LTSB personal loan some time ago, a friendly lloyds bank manager told me that (using your numbers as an example..) if i were to pay £1300 as an overpayment, then i would be charged 58 days interest on the remaining balance, i.e. £54, when subsequently settling it in full.

in other words, settle as much of it as you can afford to whilst still leaving a nominal balance, then settle the loan in full in a separate transaction. assuming the terms were similar/the same as the ones i had, you will only be charged an interest penalty on the nominal sum and not the entire £1354.

Yeah, just checked T&C's and it states roughly (as i shortened it):-

You may make overpayments at any time. An overpayment can be made as a monthly repayment, but is not enough to repay the total outstanding balance. If you make an overpayment, we will use it to reduce the length of the Loan.

So yes, i'll probably do what you suggested tehwolf. I'll phone them tomorrow to get it sorted.
Cheers for that.

supersaver09

tehwolf wrote: »

......in other words, settle as much of it as you can afford to whilst still leaving a nominal balance, then settle the loan in full in a separate transaction. assuming the terms were similar/the same as the ones i had, you will only be charged an interest penalty on the nominal sum and not the entire £1354.

Phoned them yesterday & paid off £1,275 as an overpayment.
The CS lady said they'll send a letter of confirmation in a few days, after i receive that letter i can then contact them for a 58 days interest settlement fee.....based on the £51 balance.

supersaver09

supersaver09 wrote: »

Phoned them yesterday & paid off £1,275 as an overpayment.
The CS lady said they'll send a letter of confirmation in a few days, after i receive that letter i can then contact them for a 58 days interest settlement fee.....based on the £51 balance.

Quick Update

Just to let you guys know,....my total balance (including the settlement fee) on the remaining balance of £51 was £62.21.
A settlement fee of £11.21...which works out at roughly 20%.

Thanks for all your help,...especially tehwolf for steering me in the right direction (didn't even know what an "overpayment" exactly meant before)! I could have easily been paying a 20% settlement fee on the original £1,326! :eek: So thanks again.

Hope this thread helps others as well.

tiggerywench

im just in the process of doing exactly the same thing with a lloyds tsb loan for £2700, I hope to pay off £2650 and then setlement figure on the remainder, brilliant ploy, thanks for this post folks !