Ways to pay off early

stiltoncheese

Hi everyone

I'm due to pay off my final bit of overdraft next month and then my credit card will be cleared by October due some money which is owed to me.

That will leave me with only my loan, which by December should be down to roughly £5000 (settlement figure).

I would like to pay this off sooner rather than later (currently has until Apr 11 to run) but obviously with all of the recent interest rate rises, loan rates are now a lot higher than my current rate (6.4%). Sadly, I do not have a loan which allows overpayments.

Is there any other way that I could pay this off sooner, ie: credit card tarting?

Apologies if this seems like an obvious question, but I don't really know much about credit cards etc.

Cheers

Milarky

Why so keen to repay at a decent fixed rate (with interest rates rising as you state)? If you have savings to repay this early then just keep them in the best instant access account available (of which there are many) until April comes around.

Credit cards work slightly differently - balance transfers are available - but generally restricted to paying off existing credit card debts. Exceptions are credit cards which allow balance transfers to be made by cheque (and therefore completely flexible as to payee) and those which allow balance transfers 'from overdrafts' and so will deposit money into your current account. Egg Visa/Egg money are the best known such 'muling' cards but MBNA (and their numerous co-branded cards like Virgin, A&L etc) did balance transfer into current accounts too. But never ask for 'cash' or 'money transfers' as these are advances which are at full rates of interest plus carry fees. Nearly all balance transfers at 0% (limited period) do carry fees anyway now (usually 2% to 3% - sometimes capped in amount) whilst 'life of balance' transfers (effectively fixed rate loans) may be offered fee free. LOBs transfers are attractive alternatives to normal conventional loans - the main drawback being the restrictions on what they can be used to repay directly - with the added benefit of complete flexibility of over payments

Link to Martin's article here:

CLAPTON

6.4% is a pretty good rate so if I were you and you can't make overpayments, I would just save any spare money in the best savings a/c you can find. if you haven't already opened an ISA then save there.

stiltoncheese

Thanks guys.

I know that 6.4% is a good rate, but i don't really want to be paying £150 odd pounds per month for the next 44 months. Would prefer to get rid of it sooner so that I have more disposable income.

Anyway, I will keep ploughing on for now and saving what I can - perhaps I can settle sooner if I keep saving on top and then pay off in one hit in a couple of years or so?

Want to get rid asap as I want a mortgage in next couple of years and don't want additional debt hanging over my head.

Thanks again