Is it possible to get the Interest back on a loan?

Gaz83

The explanation matched exactly how a loan works.

SeanG79

Gaz83 wrote: »

The explanation matched exactly how a loan works.

That's exactly what I was going to say...

andyfromotley

StuC75 wrote: »

Not really..

to make obscure or unclear:
to obfuscate a problem with extraneous information.

Nearlyold gave an explanation that befitted a Credit Card account - Monthly payments made reducing the balance but with interest being added on.

A loan states up front the payment required, the term of the loan, what the total repaid will be and so what the charge would be.

When you over pay or look to settle early the lender will recalculate after taking into account an interest penalty what the new balance would be.

So the explanation didn't match how a loan works.

errrrrrr, you're wrong. No worries. The explanation didn't work for you and thats fine, but the explanation WAS correct, and is much clearer than yours. But i don't really want to fall out on an internet forum about how a loan works. particularly as i already know. Peace and love.

ViolaLass

StuC75 wrote: »

A loan states up front the payment required, the term of the loan, what the total repaid will be assuming nothing changes i.e. you don't overpay and the interest rate stays the same and so what the charge would be.

When you over pay or look to settle early the lender will recalculate after taking into account an interest penalty what the new balance would be.

And Nearlyold explained the calculation that the lender will do.

Nearlyold

StuC75 wrote: »

A loan states up front the payment required, the term of the loan, what the total repaid will be and so what the charge would be.

When you over pay or look to settle early the lender will recalculate after taking into account an interest penalty what the new balance would be.

So the explanation didn't match how a loan works.

Hi StuC75 yes you are right when you take a loan they do tell you up front the payment, the term and the interest charge on the assumption that things won't change but the calculation that's used to produce the figures is as I described. This method is used across all loan types whether Personal Loans, HP, PCP or Repayment Mortgages (there are some variations of course depending on how often the interest is calculated). If you have any recent mortgage or personal loan statements they will show this. If you still don't believe me try http://www.theguardian.com/money/loan-repayment-calculator-interest-rates The figures are slightly different because I was rounding 6% PA interest to .5% PM whereas because of the effect of compounding the monthly interest charge is actually a little lower