paying off a personal loan early - surprisingly high balance?

CLAPTON

the issue you had was nothing to do with 'front loaded interest' .... thus has been banned since 2005 although many people on the board and indeed in financial institutions are still confused.

in the case of your loan, interest started from the moment you borrowed the money... perfectly fair and normal
the confusion was because they offered you a 'payment free' holiday without clearly spelling out that of course interest would be charged during this period.

mortgages are not front loaded with the interest (they never were) although they may charge you fees etc;

izools

jessej wrote: »

Thanks Tixy!

Still boggles the mind, I guess I should have looked into the relation of interest/capital repayments before I signed the dotted line, or should have just paid off the loan earlier.

Oh well, live and learn - will be the last time I'll be taking a high interest personal loan!

In future, use Zopa.

No early termination fees, no early repayment charges, no front loading, no months interest as a penalty.

You can overpay what you want, when you want, and the figures add up to what you expect

I've found them excellent to deal with and can recommend them wholeheartedly

Oh, and HSBC Loan Quotes are a rip off. They quoted me 18.9% on £4,000 when Zopa lent it to me at 12.9%