Put Loan in Savings Account

jls022

Hi all, I'm looking for a bit of advice please. I have recently taken out a new loan to replace my old one as I have managed to get a much better deal. The settlement figure on my old loan is valid until 14th June but the new loan was paid into my account today. Would there be any benefit in putting the money from the new loan into my savings account for the next week/10 days (then settling just before the 14th) or should I just pay it off now? The settlement figure will not change between now and then so I won't accrue more interest or anything, nor is there any danger of me spending any of it either. Thanks

dealer_wins

For the sake of a couple of quid I would just pay it off now. If there are any delays (Bank hols, errors etc) you have a margin of safety to sort it out.

Rafter

Interest for 7 days at 3% on £1000 is about 43p. As dealer wins says it hardly seems worth the bother given the risk you miss the 14 June date because of transfer delays between accounts and then might incur a whole extra month of interest.

One other point.... what is the redemption penalty on your current loan and how long does it have to run? You might be better off paying most of it off, avoiding the redemption penalty and paying off the balance from the new loan money you won't have used. All depends on your terms and conditions.

Good luck

R.

tell_it_how_it_is

Another to agree with "dealer wins".

Pay it off now and avoid any uncomfortable last minute dramas.