Best personal loan (£25K) allowing overpayment?

Anthony1970

Hi all,

I need to consolidate debt (~28K). I am able to finally get a loan to do this with help of family. I am thinking of getting £25K and pay the remaining off monthly to repair my credit rating.

I am looking for a loan with the cheapest interest rate that supports early payment (and over payments) without penalty.

Ideally I'd like to take a period of 3 years to pay it off in full and keep the monthly payments "comfortable" and then overpay as much as possible to get it down much earlier.


Many thanks,
Anthony

gb12345

Anthony1970 wrote: »

I need to consolidate debt (~28K). I am able to finally get a loan to do this with help of family. I am thinking of getting £25K and pay the remaining off monthly to repair my credit rating.

Do you earn over £106K?

If not then no one is going to allow you to top your borrowing up to over 53k

DCFC79

Anthony1970 wrote: »

Hi all,

I need to consolidate debt (~28K). I am able to finally get a loan to do this with help of family. I am thinking of getting £25K and pay the remaining off monthly to repair my credit rating.

I am looking for a loan with the cheapest interest rate that supports early payment (and over payments) without penalty.

Ideally I'd like to take a period of 3 years to pay it off in full and keep the monthly payments "comfortable" and then overpay as much as possible to get it down much earlier.


Many thanks,
Anthony

Be honest with yourself, you wont find a loan. Instead of having the aim of sorting your credit rating look at cutting your spending to then have more money to put towards the loan.

Anthony1970

Thanks for your replies. Apologies for any confusion.

I wish I was on £100K+ LOL. I make closer to £43K.
I have credit card debts of a little over 28K.
A family member is going to take out a loan for me that I will repay as soon as possible. (I can currently make repayments of £1000 a month and expect that to increase)

I just want recommendations for cheapest loans that do not have penalties for early repayment/overpayment.

P.S. Yes I know I was stupid to get into this situation and but I have no longer any financial distractions - particularly from banks offering never-ending credit cards and increasing credit limits.

R_P_W

Not a good idea! Why not jyst pay 1000 a month off your cards? Plus you don't have to spend every pound of credit offered you know!

Apples2

Anthony1970 wrote: »

A family member is going to take out a loan for me that I will repay as soon as possible.

This whole idea is sheer lunacy, not for you but for your Family victim.

What is his financial position? Is he earning anything like these figure mooted above?
I would guess not if he has to borrow that much to give over to you.

Could you just reconfirm to us that a member of you family is going to take out a £28,000 loan, give you the whole lot and patiently (nervously) wait for you to repay him at £1k per Month?

The loan will obviously have interest added, are you paying him even more than the interest or is he really doing this out of kindness?

What is his plan if you lose your job? Is he prepared to continue repaying?

gb12345

Anthony1970 wrote: »

I just want recommendations for cheapest loans that do not have penalties for early repayment/overpayment.

That would depend on the creditworthiness of the [STRIKE]idiot[/STRIKE] family member who is giving you the money.

He might get 5.9%, he might get 8.9%, or perhaps 19.9% or even nothing at all.

gb12345

Oh and will you be cancelling the credit cards when you've paid them off? Or will shiny things catch your eye?

I expect we'll see you here in 18 months or so asking how to pay off 28k credit card debt and the 25k you owe family.

DCFC79

No 1 can give recommendations as each persons situiation in relation to lender/ what they can borrow are all different.

A big ask for the family member. Can I ask did you ask them or did they offer to take out a loan to help you out ?

Anthony1970

No I don't use cards any more.
No I don't get enticed by shiny things. I am Mr Necessity now.
No I don't miss any card payments - my credit score is trashed by the size of my debt.
No I didn't ask for help from a family member - it was offered.
No my family member is not an idiot - that would be me =]

Thanks for all your comments. I appreciate them all and yes it does sound risky and a bad idea - but I believe I can do this from my current job and expected pay increases and additional work I do.

I have found a loan quote at Tesco for £25K@7.2% loan over 27 months will cost me £1,003.13 per month with a total repayable cost of £27,085. If I carried on paying off my credit-cards interest rates it would take far too long and cost far too much.

If I didn't think I could do it I wouldn't even be contemplating it.
I just need to get back to zero debt as fast as possible.

gb12345

Anthony1970 wrote: »

No my family member is not an idiot - that would be me =]

A lot of people who have been in the family member's position and posted on here would disagree with you. They now have trashed credit histories because the family member (or even friend in some really stupid cases) they borrowed the money for can no longer afford to or is refusing to pay for the loan.

Anthony1970 wrote: »

I have found a loan quote at Tesco for £25K@7.2% loan over 27 months will cost me £1,003.13 per month with a total repayable cost of £27,085. If I carried on paying off my credit-cards interest rates it would take far too long and cost far too much.

Has your family member applied for and been accepted for that loan? If not then it is just a meaningless random number - that will be a headline rate that only Tesco's ideal borrowers will get.