Advise regarding my Loan

carl5363

I currently have a Natwest loan with an outstanding balance of £3306.98. I can afford to make over payments of around £200.00 a month. Does anyone know if I make over payments will it reduce my monthly DD? I've checked through my T&C's but can't find anything.

I recently transferred my CC balance over to a 0% Santander CC so would rather pay the minimum payment on that for now and try and get rid of the loan.


Any help would be appreciated.


Thanks,


Carl

tonycottee

Could you ask Natwest?

DCFC79

carl5363 wrote: »

I currently have a Natwest loan with an outstanding balance of £3306.98. I can afford to make over payments of around £200.00 a month. Does anyone know if I make over payments will it reduce my monthly DD? I've checked through my T&C's but can't find anything.

I recently transferred my CC balance over to a 0% Santander CC so would rather pay the minimum payment on that for now and try and get rid of the loan.


Any help would be appreciated.


Thanks,


Carl

I also suggest talking to Natwest.

Olza23

I doubt you can, you can probably pay off the total amount of the loan early and save on the interest...

Hopefully somebody says otherwise.

arbroath_lass

From their website: If you can't find it in your agreement you will need to call as it seems to vary.

http://www.natwest.com/personal/loans/g1/already/service-options.ashx

Overpayments can reduce the total amount of interest you pay.

• For fixed rate personal loans opened before 14 November 2010: Some loans allow you to make overpayments without penalty.
• For fixed rate personal loans opened after 14 November 2010: Some loans allow you to make an overpayment and a charge may apply. Please refer to your loan agreement for details.

greenlightluke

Correct me if I'm wrong - but won't most loans allow you to make over payments? Both Halifax and Tesco allowed me to make over payments, it just reduced the interest I owed in the long term.

To be sure contact Natwest.

carl5363

I've spoken to Natwest and they do allow you to make over payments but they take 58 days interest every time you do, so would seem pointless to me making a monthly over payment. I'm going to save up in a separate savings account and then pay off a lump sum in 6 months time.They also said it would reduce my term, not my direct debit.

Cheers everyone

SeanG79

The 58 days will be applied no matter when you make the over payments, so ultimately you will save the amount of interest by over paying monthly vs the same amount in bulk every 6 months.

StuC75

58 Days interest on whatever you overpay is a lot less than what that interest would be over the remainder of the terms!. i.e. 2months vs 2,3,4 years of interest on that.

carl5363

Am I best paying £200 a month overpayment then? I was going to save that money and then pay £1200 off in 6 months time.

SeanG79

carl5363 wrote: »

Am I best paying £200 a month overpayment then? I was going to save that money and then pay £1200 off in 6 months time.

If you overpay by £200.00 each month you will save (even if only marginally) on the total interest paid on the loan compared to waiting 6 months and then paying £1200.00.