Deferred Loan

sabelu

Is there anyone that offers a deferred loan offer i.e. high interest but no payments for 12 months and no penalty if you pay off before the end of the deferrment? Like you'd see in a but now pay later offer.

sabelu

Obviously not then

doitmyself

sabelu wrote: »

Is there anyone that offers a deferred loan offer i.e. high interest but no payments for 12 months and no penalty if you pay off before the end of the deferrment? Like you'd see in a but now pay later offer.

Hi
MBNA (I am an esxisting cc customer of theirs) in amongst the endless junk they send have offered loans with a deferred initial payment, 3 months I think. Others such as Egg loan include up to 3 month payment breaks in any 12 month period. The interest in this case continues to be added and so the repayments become higer (or the term longer).
I don't imagine there is a 12 month deferred repayment loan out there actually, and I'm sure if there was it would be extremely expensive.
Are you asking because you have a need for cash now and know you have money coming in a year's time? Otherwise I'd say bad idea, you simply can't afford it...

Rafter

Some offer no payment for a few months - Halifax springs to mind, but they do charge interest from day 1 - so you aren't going to be able to borrow for nothing.

The only way to get no payments for 12 months is to 'do it yourself' as follows.

Say you want to borrow £10,000. Borrow £11,500 instead over a long period - say 5 years.

Then use the £10,000 you need and put the other £1,500 in the bank. That extra should be enough to make payments for the first 12 months before you can afford to repay yourself.

Not to be recommended unless you really know what you are doing, but could be a solution?

R.

Rafter

OK, sums wrong, if you got a Northern Rock Loan at 6.4% you would need to borrow £13000 to get £10,000 to cover your first years payments.

At the end of the year you would still owe £10,750 being the £10,000 you originally borrowed and £750 of accrued interest on the money borrowed, and the additional amount borrowed to make your first year payments.

R.