We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
Repaying loan early - zero rebate?
danlightbulb
Posts: 933 Forumite
in Loans
Hi all,
I requested an early settlement figure for my personal loan from HSBC which has 11 months of repayments left on it.
There was no interest rebate at all, the settlement amount quoted was the same as the current outstanding balance.
I have queried back with HSBC but I thought I'd check here because that doesn't seem right to me.
Thanks
I requested an early settlement figure for my personal loan from HSBC which has 11 months of repayments left on it.
There was no interest rebate at all, the settlement amount quoted was the same as the current outstanding balance.
I have queried back with HSBC but I thought I'd check here because that doesn't seem right to me.
Thanks
0
Comments
-
danlightbulb wrote: »Hi all,
I requested an early settlement figure for my personal loan from HSBC which has 11 months of repayments left on it.
There was no interest rebate at all, the settlement amount quoted was the same as the current outstanding balance.
When you say "the same as the current outstanding balance" do you mean it is the same as the total of the next 11 payments?
Depending on how they add the interest, your outstanding balance could be the same as the settlement figure, but this number could be different to the total of the payments you would still be making0 -
danlightbulb wrote: »There was no interest rebate at all, the settlement amount quoted was the same as the current outstanding balance.
It would be. As the online balance has yet to incur monthly interest charges.0 -
Right here are the details:
11 monthly repayments remaining of £199 therefore total repayments remaining of £2189
Shown as outstanding balance in online banking £2189.
Information recieved when settlement amount requested:
Settlement amount £2189
Interest rebate £0
The original loan was for £9400 over 60 months at 9.9% APR.0 -
Thrugelmir wrote: »It would be. As the online balance has yet to incur monthly interest charges.
HSBC Start your opening balance with the total interest of the entire agreement already added on to it.
Which personal loan is it? Some of their loans, they never used to allow for overpayments. So paying early means you would still have to pay off all the interest.danlightbulb wrote: »Right here are the details:
11 monthly repayments remaining of £199 therefore total repayments remaining of £2189
Shown as outstanding balance in online banking £2189.
Information recieved when settlement amount requested:
Settlement amount £2189
Interest rebate £0
The original loan was for £9400 over 60 months at 9.9% APR.Credit 'Score' - Don't buy the credit 'score' that Experian, Equifax and Noddle want to sell you. It's an arbitrary number that means nothing when it comes to applying for credit.
ALWAYS HAVE A DIRECT DEBIT SET UP FOR THE MINIMUM PAYMENT ON YOUR CREDIT CARDS, REGARDLESS OF WHETHER YOU PLAN TO LOGIN AND PAY EACH MONTH.0 -
I don't know the exact product name however as far as I knew it was a fairly standard personal loan, no bells and whistles, not done as part of any promotional offer. Just a straightforward 60 month personal loan.
It probably doesn't allow 'overpayments' in the regular sense, but this is an early settlement request which I believe I'm entitled to by law.0 -
I'd contact them about it, I think it might just be because you're so far in to the loan. The interest may have been front-loaded which means you would have already paid it off.Credit 'Score' - Don't buy the credit 'score' that Experian, Equifax and Noddle want to sell you. It's an arbitrary number that means nothing when it comes to applying for credit.
ALWAYS HAVE A DIRECT DEBIT SET UP FOR THE MINIMUM PAYMENT ON YOUR CREDIT CARDS, REGARDLESS OF WHETHER YOU PLAN TO LOGIN AND PAY EACH MONTH.0 -
thebritishbloke wrote: »I'd contact them about it, I think it might just be because you're so far in to the loan. The interest may have been front-loaded which means you would have already paid it off.
it's against the law to front load interest0 -
Are you sure about that? Unless regulation has changed recently, I've read a multitude of articles that say it's pretty normal for it to happen, especially on HP loans.it's against the law to front load interestCredit 'Score' - Don't buy the credit 'score' that Experian, Equifax and Noddle want to sell you. It's an arbitrary number that means nothing when it comes to applying for credit.
ALWAYS HAVE A DIRECT DEBIT SET UP FOR THE MINIMUM PAYMENT ON YOUR CREDIT CARDS, REGARDLESS OF WHETHER YOU PLAN TO LOGIN AND PAY EACH MONTH.0 -
thebritishbloke wrote: »Are you sure about that? Unless regulation has changed recently, I've read a multitude of articles that say it's pretty normal for it to happen, especially on HP loans.
HP has somewhat different rules (and I'm not sure about HP as it's a hire agreement with a right to buy for a nominal trivial sum)) but all ordinary credit agreements regulated by the CCA can't front load interest (well they can but must apply a rebate if paid off early).0 -
HP has somewhat different rules (and I'm not sure about HP as it's a hire agreement with a right to buy for a nominal trivial sum)) but all ordinary credit agreements regulated by the CCA can't front load interest (well they can but must apply a rebate if paid off early).
I would've thought that HP would be very similar to other loans now, with them being regulated by the CCA.
Wasn't entirely aware, thanks
Credit 'Score' - Don't buy the credit 'score' that Experian, Equifax and Noddle want to sell you. It's an arbitrary number that means nothing when it comes to applying for credit.
ALWAYS HAVE A DIRECT DEBIT SET UP FOR THE MINIMUM PAYMENT ON YOUR CREDIT CARDS, REGARDLESS OF WHETHER YOU PLAN TO LOGIN AND PAY EACH MONTH.0
This discussion has been closed.
Categories
- All Categories
- 347.1K Banking & Borrowing
- 251.6K Reduce Debt & Boost Income
- 451.8K Spending & Discounts
- 239.4K Work, Benefits & Business
- 615.3K Mortgages, Homes & Bills
- 175.1K Life & Family
- 252.7K Travel & Transport
- 1.5M Hobbies & Leisure
- 16K Discuss & Feedback
- 15.1K Coronavirus Support Boards