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Cheapest way to settle loan

I have 12 months of a loan left to pay.

The total left over 12 months is £4776

I have asked for a settlment figure and that is £4572.

Would it be cheaper yet again if I make an over-payment of say £4200 then call again for a settlement figure on £372?

I tried to get this information from the bank but they tried to sell me a new loan at a cheaper rate.

Comments

  • R_P_W
    R_P_W Posts: 1,507 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    why not just pay it off if you have the money?
  • I definitely can make an over-payment. They did confirm that over the phone when I asked for the settlement figure.

    @RPW - I could just repay the settlement but I am trying to use expert advice to save some money :rotfl:
  • Tixy
    Tixy Posts: 31,455 Forumite
    With some lenders/loans it would be cheaper, as you'd pay less early settlement interest, with others it would make no difference. Depends on the t&cs.
    A smile enriches those who receive without making poorer those who give
    or "It costs nowt to be nice"
  • Moneymash
    Moneymash Posts: 510 Forumite
    Part of the Furniture 100 Posts Combo Breaker Debt-free and Proud!
    Why don't you pay off the entire loan apart from one instalment, when the DD is taken the loan should finish naturally. Depending on your ts and cs you could avoid two months interest for settling early.
    Debt-Free day 30th September 2014
  • Moneymash wrote: »
    Why don't you pay off the entire loan apart from one instalment, when the DD is taken the loan should finish naturally. Depending on your ts and cs you could avoid two months interest for settling early.

    This. It's exactly what I did just before Christmas.
    I was a DFW, now I'm a MFW :T
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