Paying off product loan and taking out again

samo8076

Hi,

I bought some hifi equipment a few months ago on credit/loan, and im in the position to pay the balance off.

However, I am in the need of a new tv, and have seen the tv within the same firm I bought my hifi from. So would it be possible to pay off the current balance on my hifi, and then take out new finance on the new tv? Or will this cause issues?

many thanks

Tixy

No problem to pay off the existing loan early.

The second loan would be subject to a new application and credit check. Its unlikely that repaying the first loan early would have a negative impact on them accepting you for a new product.

samo8076

Thanks Tixy.

StuC75

Do check the type of finance you took out as to whether there is a cost benefit in paying off one balance to replace with another?

Was it interest free ? (if so leave as is and benefit from the interest on the money you have whilst drip feeding payments through) - effectively stoozing.. Is there an admin fee to do so? Do they still offer interest free or would the terms be different..

What are the amounts in question?

iancrt

Paying off a loan will probably have some fees (1 months interest which will be almost a months payment if its relatively new loan) then waiting till it clears on your credit data, plus all the time you spend organising and checking all this.
Radical options here.
How many more months would it take you to save the extra to pay for the TV outright?
If you feel you can't wait - do you have a CC you can use to make up the balance? if its only a couple of hundred quid you can get it paid back in 3-4 months its could still be cheaper than agreeing a fixed term loan but with the flexibility of taking longer if you needed to.

KIS - Keep It Simple!

samo8076

It is interest free yes. The amount I owe is £320, but the new tv i want is £850

StuC75

What is the remaining Term & Repayment on the £320?

What would the Term & Repayment be on the £850 for the TV (or £530 if you were to pay more upfront for the TV).

Given both are interest free, its really a case of 6 and 2x3's.. in terms of what the combined balance owed would be, with the only difference being what the number of months was (12/24/36 months..)..

Who was the retailer, and what exactly is the type of finance that was taken out?.. Definitely a loan? or was it some form of BNPL \ IF(O) revolving credit facility (not touched Shop arranged financing in years so not sure whats the normal nowadays)..

samo8076 wrote: »

It is interest free yes. The amount I owe is £320, but the new tv i want is £850

samo8076

The remaining term is 9months I think. I had it over 12 months, and would be doing the same with the tv.

The retailer is Dawsons, and the finance s with V12

Cycrow

if they are both interest free, then the best options would be to stick the money you have now into an interest earning account then use it to pay of the balance in 9 months, i assume its a BNPL plan ? or do you have monthly payments ?

the only question is wether V12 will approve a 2nd application or not.
you could try speaking to Dawsons to ask, but if they dont do the finance themselves, they may not even know