Unsecured Halifax Personal Loan

JimDuff

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I am looking to borrow from Halifax to pay my existing car finance off. My plan is to over pay a substantial amount in the first couple of months (£500-1.5k) as it looks like you have the ability to over pay as often as you want, obviously on which finance I don't.

I am just wondering how this affects monthly payments, obviously they recalculate interest but will they keep my monthly payments the same and just deduct any extra off the interest? The idea was to lower my monthly payments via overpayment but if it does not benefit the monthly debit amount then I may as well stick to finance.

Tixy

I believe the effect of overpayments is that they will keep your repayment level the same and reduce your term.
But I'd ask halifax to confirm. Also you might want to check whether they charge a fee for the overpayments (which they are allowed to do now, but I'm not sure if halifax do, or if they only do once your overpayments reach a set limit).

JimDuff

I have an appointment on Saturday to go through things was just wondering if anybody knew. Also their online rate is apparently different than if I go in branch so I'm half tempted to just apply and see..

Cash_Flow

JimDuff wrote: »

I am looking to borrow from Halifax to pay my existing car finance off. My plan is to over pay a substantial amount in the first couple of months (£500-1.5k) as it looks like you have the ability to over pay as often as you want, obviously on which finance I don't.

I am just wondering how this affects monthly payments, obviously they recalculate interest but will they keep my monthly payments the same and just deduct any extra off the interest? The idea was to lower my monthly payments via overpayment but if it does not benefit the monthly debit amount then I may as well stick to finance.

The monthly payments will remain the same - The only lender that I know of that will give you the option to change the monthly payment is Tesco

Cash_Flow

JimDuff wrote: »

I have an appointment on Saturday to go through things was just wondering if anybody knew. Also their online rate is apparently different than if I go in branch so I'm half tempted to just apply and see..

You will get a better rate online. Halifax also offer better rates if you apply for more than £7499;)

JimDuff

Yeah I initially wanted £6800, but the APR doubles! Its cheaper to borrow £7k+. However I'm reluctant to apply until I know for certain that over paying will benefit me with reduced monthly payments.

chanz4

The apr will be about 20%, so make sure its worth it first

JimDuff

To be honest if overpayments make little difference to the monthly debit, I more than likely wont bother. I just wanted the flexibility of being able to downgrade easily if I needed to and overpaying the difference. May as well have the money in the bank to cover payments as opposed to taking a hit on interest.

JimDuff

The APR is 20% for amounts under what I need. If I borrowed what I needed the APR is considerably less, 8.8% but subject to credit obviously.

InsertWittyName

If you're an existing Halifax customer in good standing with them then I would apply online (when logged into your internet banking).

Also, make sure you do it between 9am - 8.30pm and they'll pay it instantly into your Halifax account.

At the end of last year I did the above and got a £10k loan paid instantly into my Halifax account, with an APR of 8.8%.

Hope this helps.

[EDIT] And to answer your original question, overpayments reduce the term of the loan with Halifax, the monthly payment remains the same.

JimDuff

Thanks for the info. Have been a customer with them for over 8 years and have had a loan with them online no problems previously. No reason for me to trail into the bank really If I can apply online! Does the application tell you what rate they can give you straight away?