"Interest free" loan - early settlement?

paolob_2

I have interest free financing from B&Q (for a new kitchen) - about £6,000 - 60 payments of £100 per month over 5 years. I am interested in saving some money by paying this off early in one lump sum - but B&Q Financial Services (part of the HSBC group) won't offer any discount for doing this. They insist on receiving the full amount whether I pay over 5 years or the whole amount tomorrow - even though it's obviously a huge saving for them if I pay off early. (I'm guessing in their books there is a large interest element added to the kitchen cost to 'pay' for it being 'interest free'). For an exactly similar loan repayment schedule a typical hire purchase would offer a big discount for full settlement. Any advice please on how I can persuade B&QFS (HSBC) to make me an offer?

Tixy

I think you have no chance of them agreeing to reduce the balance below the loan amount.
If its been sold to you as interest free then they are going to want the full balance from you regardless.

Whilst there might be a small saving for them in having the money back earlier, it won't change the amount of comission they earned on the deal from B&Q.

Firefox1975

Only offer you will get is the remaining balance.

Why would you think you could pay less than the purchase price?

why not stick whatever balance you have available into a seperate account and pay the DD's from there? your bonus is the interest you will make on the residual balance over 5 years.

somethingcorporate

Stick the money in a high-interest account, you'll make a few quid in interest over the years you pay it off.

No chance in getting them to reduce what you repay to less than the value of the goods you bought.

Catslovelycats

somethingcorporate wrote: »

Stick the money in a high-interest account, you'll make a few quid in interest over the years you pay it off.

No chance in getting them to reduce what you repay to less than the value of the goods you bought.

I did this with a purchase a few years ago. I bought on 0% on my card even though I was lucky enough to have enough to pay outright. Shoved the money in a savings account and paid it off before the term ended.

At least that way you're getting some credit interest and will feel like you're gaining somehting.

katejo

paolob wrote: »

I have interest free financing from B&Q (for a new kitchen) - about £6,000 - 60 payments of £100 per month over 5 years. I am interested in saving some money by paying this off early in one lump sum - but B&Q Financial Services (part of the HSBC group) won't offer any discount for doing this. They insist on receiving the full amount whether I pay over 5 years or the whole amount tomorrow - even though it's obviously a huge saving for them if I pay off early. (I'm guessing in their books there is a large interest element added to the kitchen cost to 'pay' for it being 'interest free'). For an exactly similar loan repayment schedule a typical hire purchase would offer a big discount for full settlement. Any advice please on how I can persuade B&QFS (HSBC) to make me an offer?

Slightly different question: Were you satisfied with the kitchen? I want to get mine done. I like the look of some of their designs but have heard negative feedback about their installation work.

somethingcorporate

katejo wrote: »

Slightly different question: Were you satisfied with the kitchen? I want to get mine done. I like the look of some of their designs but have heard negative feedback about their installation work.

Head over to the DIY board to ask the question - it has been asked a number of times before and the general answer is it depends on how lucky you are - the installers are hit and miss.

opinions4u

paolob wrote: »

I have interest free financing from B&Q (for a new kitchen) - about £6,000 - 60 payments of £100 per month over 5 years. I am interested in saving some money by paying this off early in one lump sum - but B&Q Financial Services (part of the HSBC group) won't offer any discount for doing this. They insist on receiving the full amount whether I pay over 5 years or the whole amount tomorrow - even though it's obviously a huge saving for them if I pay off early. (I'm guessing in their books there is a large interest element added to the kitchen cost to 'pay' for it being 'interest free'). For an exactly similar loan repayment schedule a typical hire purchase would offer a big discount for full settlement. Any advice please on how I can persuade B&QFS (HSBC) to make me an offer?

Why on earth should they discount it?

The damage accepting such offers would do to their business would be immense.

They say "yes" to you, then you come on post it on a couple of messageboards and then the world joins the clamour to get a chunk knocked off the loan for early settlement.

It's a bizarre notion.

As others have suggested, stick your money in a decent savings account and earn a bit of interest back on it. 4%+ AER on a 2 year fix might be a starting point.