I have a 'get out of jail' 10K. How can I spend it to pay off debt?

money_free_2011

Hello,

My 1st post :j

I am 26 and after stupid car purchases (2 blew up) and some sporadic spending I got into 30k debt. I sorted myself out 2 years ago and consolidated all my credit cards (thank god - would have been 50yrs old before paid off). I am now married with a 1 yr old boy and a desire to bve debt free in 2 yrs. My debt is the following.

13k Egg Loan
5.6k Lloyds loan
3k car
1k parents loan

I have 10K from a work bonus and previous savings and selling 1 x small car. I want to use this at its full advantage of paying off the debt.

How much would egg accept as a final payment. I have a bank acct with LLoyds so did not think they would accept an settlement?

Also want to do this with as little 'scarring' to my credit rating as unbvelievably I have not defaulted on these payments on any major scale. The odd late payment due to personnal admin error.

Any info / advice especially with egg is appreciated!

Regards

A

BettiePage

What are the aprs?

Gordon_Hose

The only way you can find out if a company will take F&F's is to call and ask. I doubt anyone here will be able to give you an accurate figure.

The worst they can do is say no.

beanielou

Are you already on reduced payments with Egg?
If not there is no chance they will accept a F & F.

money_free_2011

beanielou wrote: »

Are you already on reduced payments with Egg?
If not there is no chance they will accept a F & F.

No reduced payments but our outgoings shows a defecit of £300 now my wife has stopped working due to children!

money_free_2011

BettiePage wrote: »

What are the aprs?

10% egg
13% car
12% Lloyds
I think

DVardysShadow

money_free_2011 wrote: »

10% egg
13% car
12% Lloyds
I think

You should try the snowball calculator

http://makesenseofcards.com/snowcalc.html

My feeling is that you should pay off the Lloyd's loan in full, which will release some money each month, then you should repay your parents. Normally you should pay off the highest APR first, but loans can be messy to part repay, so paying off in full works better. And loans to family and friends are good to repay, especially if you might need help again.

curlytop12

And loans to family and friends are good to repay, especially if you might need help again.[/QUOTE]

now that is cracking advice:)

imogen-p

Being as you aren't in default with any of the companies it is just a case of whether they have any early repayment costs attached to the loan. Because you're up to date with payment they aren't likely to take a reduced sum in final settlement - that seems to be only something they do when they feel that they're unlikely to ever get all of their money back any way.

Why wouldn't Lloyds accept you paying off your loan with them because you hold a bank account with them? I bank with Lloyds current acc and have had a loan with them in the past, and they didn't seem to have any problem with me paying off the loan early.

You've said that the decrease in household income means being -£300. Which of the loans is costing you most per month? Pay them off first, then if there's money left over pay off the one that is next highest.

My suggestion would be pay off loans from parents, car and lloyds, leaving only Egg. Okay it's the higher debt, but it's got the lowest APR, and because you aren't paying anybody else you might then be able to start over paying Egg to get it cleared faster.

I've had a Egg loan in the past (well nearly in the past last payment is next month ) They are generally very good about over paying either by increasing monthly payments or sending in occasional lump sum payments. They didn't charge me any extra for doing either of these, and I cut 18 months of the life of a 4 year loan.

impulsive

money_free_2011 wrote: »

Hello,

My 1st post :j

I am 26 and after stupid car purchases (2 blew up) and some sporadic spending I got into 30k debt. I sorted myself out 2 years ago and consolidated all my credit cards (thank god - would have been 50yrs old before paid off). I am now married with a 1 yr old boy and a desire to bve debt free in 2 yrs.

Sounds like me.

I'm 26. Ran up about 30k debt on cars and gadgets when I was younger.

I took the decision to go into a trust deed and my last payment is on 1st July this year!


Anyhoo, about the £10k.

Depending on the length of the loans remaining then the balance left to pay may be less, as if you pay it off early then you'll pay less interest.

So my first port of call would be to call each company and get a repayment quote from them. EDIT: that's if you haven't already done so and the figures above are just calculations based on the "monthly payment x payment remaining".

dano17439

Pay off your parents, the car and the Lloyds loan.

Then with the money youve saved per month on the above repayments, add it to what you pay for the Egg Loan and refinance that to a shorter period therefore paying less interest, but still have the same payments per month