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Full early repayment calculations

Dear all,

I'm planning to pay off a loan early, but I find it very hard to try to calculate the final settlement figure (and I suspect I'm making a few mistakes). My loan is with Natwest and according to the T&C there is a 2 month interest penalty for paying off early.

These are the figures:

Original amount: £7000, 11.1%, 48 payments of £182, total including interest: £8736.

Planned final settlement date: Sept. 2007 (after 25 payments of £182).

Because the interest is front-loaded, I'm not sure how much is left in September (and Natwest is not able to give me a figure so far ahead). If the interest was not frontloaded, there would be £3375 (excluding penalty interest) left on the principal, but I suspect that it will in fact be more.

Any advice is very welcome.

DG

Comments

  • Xbigman
    Xbigman Posts: 3,903 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    I can't work it out exactly, although their are others who might be able to do it or to direct you to an online calculator, but using a very rough rule of thumb I would say £4150 plus penalty interest plus any other charge (possibly none).

    Was PPI attached to the loan? If it was then you get a rebate on the full term of PPI rather than a pro rata deduction, so the settlement figure might be higher.
    Regards


    X
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  • Xbigman
    Xbigman Posts: 3,903 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    Actually I worked it out a bit differently (I looked up an old 4 year 5k loan illistration I had :D ) and it looks more like the loan balance after 25 payments would be around 3900.

    Did you get a loan illistration when you took it out. Its a list detailing each payment, how much of the payment is interest and a running balance. If you did then look up the total after 25 payments.
    Regards



    X
    Xbigman's guide to a happy life.

    Eat properly
    Sleep properly
    Save some money
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