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Lloyds TSB loan
Hi,
I took a loan in Jan 2012 for 20K on an interest rate of 8.6% over 5 years.
I have been making significant overpayments and now have an outstanding balance of approx 10K. I have another 6K that I can pay off immediately and feel that I will completely pay it off by the end of August 2013.
So the questions:
1. Am I getting a better deal by paying off early? or am I simply reducing the term of the loan (this is what the bank tells me).
2. Is it possible to re-negotiate the terms (interest rate) of the loan to reduce the final redemption figure?
Your comments would be appreciated.
DC
I took a loan in Jan 2012 for 20K on an interest rate of 8.6% over 5 years.
I have been making significant overpayments and now have an outstanding balance of approx 10K. I have another 6K that I can pay off immediately and feel that I will completely pay it off by the end of August 2013.
So the questions:
1. Am I getting a better deal by paying off early? or am I simply reducing the term of the loan (this is what the bank tells me).
2. Is it possible to re-negotiate the terms (interest rate) of the loan to reduce the final redemption figure?
Your comments would be appreciated.
DC
0
Comments
-
You cannot renegotiate the existing loan - only apply for a new one to repay the old one.
If you only need around £6k it is unlikely that you will get a better rate than you have already.
The bank are correct in what they are telling you - the overpayments are reducing the term of the loan and therefore the interest that will be charged.0
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