You *CAN* overpay a Barclays loan

CLAPTON

randomnut wrote: »

Yes it stands to reason that the overall interest is reduced, as it is charged on a monthly basis on the outstanding balance and if you are making overpayments, you end this interest calculation sooner.

I could be wrong, i know so little about how this all works it's embarassing i'm just happy to be paying this off sooner.

if indeed the overpayment reduces the capital and then the interest is calculated on that reduce capital, then of course the overall interest will be reduced too.

however not all pre-2011 loans do that ; hence my point.

archie2002

ALL barclays loans old and new loans you can do this to. It defiantely reduces the term and the amount in interest you will pay. The monthly payment will always stay the same.

chanz4

outs doesnt give a sortcode and acc number just a long ref in barclays online banking

MentalMinnie

Sorry to resurect an old thread, but I want some clarification. I'm about to take out a small-ish loan from Barclays (online) as i was reading the T&C's it says about early re-payment incurs a 30 day interest charge...but i'm confused?! I thought you could over pay a loan with NO penalty?! Or am I confusing 2 different things?!

Tixy

MentalMinnie wrote: »

Sorry to resurect an old thread, but I want some clarification. I'm about to take out a small-ish loan from Barclays (online) as i was reading the T&C's it says about early re-payment incurs a 30 day interest charge...but i'm confused?! I thought you could over pay a loan with NO penalty?! Or am I confusing 2 different things?!

They are allowed to charge for early repayment and for over payments - details of the rules are here -
http://www.moneysavingexpert.com/news/cards/2011/02/the-credit-card-and-loan-shake-up-what-it-means-for-you

Loan lenders must let you overpay. If you've spare cash you can overpay each month to clear the debt quicker. Providers can charge you up to 1% of the overpayment (if there's at least a year of the loan term left) or 0.5% (if under). Before, the only flexibility you had was to pay the loan off in full early, usually at a cost of one month's interest, which still stands.

Not all lenders will choose to charge for overpayments, some only charge for large overpayments but not smaller ones.
But most still charge for settling in full early and barclays must be one that does if thats what you've read in the T&Cs.

MentalMinnie

I'm going to have to call them. I took a loan out over a year ago and was told i could overpay should i have spare cash lying around, without penalty. I never got the oppertunity to overpay and the loan ran it's course. I'm taking the new loan out over a loooong period to ensure that we can comfortably afford the monthly payment, but it's likely we'll have the money to overpay and clear it faster.

Tixy

Do the T&Cs of the new loan not state about overpayments or partial overpayments?
Or were you looking at the T&Cs from your old loan?

If not then as you say best thing is to call them.

rdchick

Thanks for this thread, it inspired me to call Halifax and I now have the sort code and account number to make overpayments on my loan yay! xxx

MentalMinnie

Called them up, you can make overpayments with no penalty, it's just when you come to make the final, settlement payment that they charge you the 30 day interest.

Cash_Flow

Tixy wrote: »

Do the T&Cs of the new loan not state about overpayments or partial overpayments?
Or were you looking at the T&Cs from your old loan?

If not then as you say best thing is to call them.

These are the terms for my Barclayloan taken out in Oct-2011

Partial early repayment - You may make additional early payments to your loan but you must notify us prior to doing so. For each partial early repayment made we will charge you a fee equal to 30 days interest on the amount being repaid. This fee will be taken from the additional early payment you have made. This loan agreement will continue and if all remaining loan payments are made as due then the loan term may be reduced as a result of the partial early repayment.