Advice in lowering a loan amount???

Chasing_cars

Hi all,

Currently running a £215 (on £10k) loan a month - and although it's kinda manageable I do feel it would be ever so helpful to lower the amount.

Talked to the bank and they are happy for me to carry on paying that amount even though I explained the situation (of course they would be...) but does anyone have any tips or advice on what I could do?

Because with this loan and the rest of my bills, living expenses everything minus "social" - I currently total at £900 for everything on earnings of £1,200 - £1,300 monthly (depending on over-time).

So being honest lowering the loan amount would be great!

Please let me know your thoughts

Typhoon2000

Sounds like you have plenty left over after paying the loan, other bills and living expenses. Just keep plugging away at it as you are.

Chasing_cars

Is £215 reasonable on a 10k loan?

The reason I panic - years ago I got into mountains of debt, horrible time of my life to be honest (thanks to University and other reasons) so I still panic I will fall back into **** (mind my french) if things get to expensive.

I just feel consolidating to a lower amount would be more cost effective?

gb12345

Chasing_cars wrote: »

Is £215 reasonable on a 10k loan?

That would depend on the term of the loan and the APR as to whether it is reasonable.

Also, you have to consider whether you would actually get another loan, which would depend on your income and debts.

happycamel_2

The more you pay back each month the less you'll pay in total as interest will accumulate over less time (subject to the loan's terms and conditions). It would never be more cost effective to pay less per month. The total amount of personal wealth you hand over to the loan company would increase, not decrease.

Maybe pop over to the DFW board and post an SOA and see if there are any other places you can make savings. In the short term, if you need more money is there anything you can sell or downgrade? What did you spend the £10k on? Can you liquidate any of it and pay off some of the loan?

[Deleted User]

Chasing_cars wrote: »

Is £215 reasonable on a 10k loan?

The reason I panic - years ago I got into mountains of debt, horrible time of my life to be honest (thanks to University and other reasons) so I still panic I will fall back into **** (mind my french) if things get to expensive.

I just feel consolidating to a lower amount would be more cost effective?

Not sure if you're asking to lower the loan amount (ie pay back more of the loan as a lump sum, which would be a good idea) or extend the term so you can pay back less each month over a longer period (much less of a good idea).

But with £300-400 disposable income each month, I'd definitely advise to make some overpayments (keeping a small savings buffer).

R_P_W

doesn't really matter if you or we think £215 is reasonable or not. that is what you signed up for!

The only way you could lower the payment would be to get a new loan over a longer period. This would be stupid in my opinion though so don't do it.

Hang_Tight_Harry

Chasing_cars wrote: »

I just feel consolidating to a lower amount would be more cost effective?

By consolidation you mean getting another loan with lower payments? So you'll be paying more interest over a longer period of time. In other words, it'll cost you more. That sound like a good idea to you?
Not entirely surprised you got into financial difficulties with that sort of logic. Mind you, I see you spent £10k on a load of crap - student overdraft, pay off a credit card, pay for a holiday etc.

You have at least £300 a month disposable income - and expressed an interest in saving in previous posts. Any sensible person would be throwing that at the loan to pay it off quicker - not looking to extend it. I don't think you've learned anything from your earlier financial difficulties and will be overstretched again in no time.