should i settle a debt to save a few quid interest?

lavamyz

hi there

took out a loan in late 2006 for £8100 and i have a year left (12 payments) it was at a delicious 25.99% apr and i've been paying 244.39 a month.

just asked for a settlement figure and its 2709.13 which will save me 223.55 which isnt a massive amount given the whopping apr i've been paying but such is life.

my question is - should i pay it off and be done with it, saving 200 quid in the process, or should i just leave the 2709 in my account (i have the willpower to leave it alone) and let the payments eat it away and have the "opportunity cost" of keeping the cash and gaining a minutia of interest too.

if the rebate was bigger i'd settle it, but for 20 quid a month i'm tempted by keeping the cash in my account.

HappyMJ

Do you want £223.55 or not? I'd pay it off if I had the chance.

timbstoke

£220 is hardly "a few quid."

Personally, I'd get it paid. It's not just £20 a month, it's also the extra £244 you no longer have going out of your account. If you find yourself in need of the money you can always get another (probably cheaper) loan.