Accepted for a loan I don't need now

Southend1

Apples2 wrote: »

What???

You pay interest over the term of the loan. whether you need it now or in three months is of no consequence, you would finish the repayments three months earlier than taking it out three months later.

If it's more than you need, just make an overpayment back again.

Crikey do people really manage their finances like that? No wonder so many have debt problems.

If you don't need the loan don't take it. If you need a smaller loan in three months then apply for a smaller loan in three months.

Otherwise you will either be paying interest on surplus funds sitting in a bank account or frittering it on unneeded trinkets.

shortcrust

Southend1 wrote: »

Crikey do people really manage their finances like that? No wonder so many have debt problems.

If you don't need the loan don't take it. If you need a smaller loan in three months then apply for a smaller loan in three months.

Otherwise you will either be paying interest on surplus funds sitting in a bank account or frittering it on unneeded trinkets.

Exactly. The idea that you should get a loan now because you may need money at some point in the future is just mad.

CHR15

shortcrust wrote: »

Exactly. The idea that you should get a loan now because you may need money at some point in the future is just mad.

I don't think that is what was meant. The op clearly said he had a loan offer and would need a loan in a few months.
Although no figures were given it is common for higher loans to carry a lower apr so it would be cheaper overall if the extra was paid back to the loan immediately as an overpayment.

This would mean the op would owe the same capital figure but could be paying much less interest for the loan

Now consider the more searches there are the higher the perceived risk so a second loan application may carry an even higher Apr ,if accepted at all.

shortcrust

CHR15 wrote: »

I don't think that is what was meant. The op clearly said he had a loan offer and would need a loan in a few months.
Although no figures were given it is common for higher loans to carry a lower apr so it would be cheaper overall if the extra was paid back to the loan immediately as an overpayment.

This would mean the op would owe the same capital figure but could be paying much less interest for the loan

Now consider the more searches there are the higher the perceived risk so a second loan application may carry an even higher Apr ,if accepted at all.

"...as I may need to get a lower value loan when I move into my new house in a couple of months time..."

'May' and 'will' don't mean the same thing.

Apples2

I didn't think it was that difficult to grasp.

shortcrust

Apples2 wrote: »

I didn't think it was that difficult to grasp.

What I'm unable to grasp is why you would advise someone to take a loan that they may not need.

Apples2

shortcrust wrote: »

What I'm unable to grasp is why you would advise someone to take a loan that they may not need.

It's like swimming upstream..

I haven't advised anyone to go around randomly applying for loans just in case they might need one.

The OP has a loan offer which, I assume, he is happy with the rate offered. If there is only a couple of months before it is needed then it makes sense to take it. The risk is a newer loan may carry a higher apr then the existing offer.
The bigger risk is that the application may not even be accepted in a couple of months, what then?

Who knows what the figures are between the current offer and what OP needs for the next venture? the OP hasn't stated them.
Who knows how many searches OP already has in searching for his current offer? the OP hasn't given that info either.
If the current offer is after a second/third search then the next one will likely decline.

Southend1

Apples2 wrote: »

It's like swimming upstream..

I haven't advised anyone to go around randomly applying for loans just in case they might need one.

The OP has a loan offer which, I assume, he is happy with the rate offered. If there is only a couple of months before it is needed then it makes sense to take it. The risk is a newer loan may carry a higher apr then the existing offer.
The bigger risk is that the application may not even be accepted in a couple of months, what then?

Who knows what the figures are between the current offer and what OP needs for the next venture? the OP hasn't stated them.
Who knows how many searches OP already has in searching for his current offer? the OP hasn't given that info either.
If the current offer is after a second/third search then the next one will likely decline.

If OP definitely needed a loan in a couple of months and had calculated it would work out cheaper over the term to take this one then I might agree. However OP only says he MAY need a loan in the near future.