Loan early repayment penalty?

new_leaf_6

I've paid 12 months of a Nationwide 3 year loan. I asked for an early settlement figure as I'm being made redundant :eek: and want to clear my debts before I do anything else with the money. (MSE DOES work!) I've been told that there's a 56 day interest charge? Is this an ok figure or am I being ripped of a bit?

darkcloudi

Thats what it says on their website http://www.nationwide.co.uk/loans/summary.htm ( Paragraph from webpage copied below ) As your loan was more then 12 months you got to pay 56 days interest as an early repayment charge. Many companies vary from the amount of interest they would charge I guess usually the average is 2 months which is what you are paying.



Fees/account conditions:
Application fee: None
Early redemption charge: 28 days interest for new loans of 12 months, 58 days interest for new loans of more than 12 months
Other fees: None
Default charges – (if applicable) e.g. for late payment: None

shades_2

2 Months is usually industry average however Alliance & Leicester charge only 1 months interest IF the loan period is longer the a year

silvercar

can you make a capital repayment to lower your outstanding balance and then a few days later settle the loan. My loan agreement states the extra interest is charged on the balance on the preceding day.