Rule of 78-ends for existing loan holders in 2007?

moni72

One of Martin's articles says

"New rules have stopped Rule of 78 for new loans, yet there’s no respite for existing loan holders, for whom it continues until 2007."

Does anyone have any further info on what happens this year for existing loan holders and Rule 78? ie does something kick in which legislates against Rule 78 for existing loan holders?

I have a Bank of Scotland loan which always carries a huge settlement figure because of them loading the interest at the front, is there something that changes this year where they can't do that?

Thanks!

Xbigman

I don't know what changes this year but everyone should not assume that the rule of 78 going would mean big reductions in settlement figures. Rule of 78 pushes what you pay up if you settle early but does not dictate how the loan itself is repaid.
Regards



X