loan- paying off

rikih

hi all i know this must have been posted here about 10000 times but i need some help, i was quite stupid a year ago i got a pc from pc world. as i am a apprentice icouldn afford to buy the pc outright- so i got it on finance the bad thing is the apr is way up at about 17.5 %!!! dont ask me why i did it. since then i have had a pay rise and i want to pay it off.
would it be better to start another loan with a cheaper apr, if so who has the best deals on loans at the moment?

thank you all for your help

rikih

anyone?

Debt_Free_Chick

Martin's article HERE probably has all the details you need.

mountainofdebt

Calm down ....everyone's probably at work,lol!

Is it one of those loans where interest is added to the loan each month on that month's outstanding balance or is it the more traditional type of loan?

If it is the former then I guess I would be tempted to see if I could a cheaper loan. If it is the type where you are going to have to pay penalties to clear the loan early then I would (personally) keep the loan but put any spare cash I had into a savings account (ING do one paying interest at 5%) until the balance had grown to a sufficient level to pay off the loan.

Don't beat yourself up about your decision....just make sure you use it as a learning curve

mrcow

Agreed, you need to find out how much it will cost you to pay this finance off, if you are going to be penalised for paying it off early, then it may not be worth it.

Once you've established this, you need to work out how much you're looking to borrow and over what term (ie. how much can you afford?) in order to work out what your best option will be.

rikih

ok, well i have spoken to the company and i can pay off the loan without having a penalty. i was looking earlier on moneysupermarket.com and i can get a loan from cahoot- £700 at a rate 6.9% this is very low for the amount of money?! i have not read fully through the advert but it seems a cheap? it is without protection but i will only be paying it of for 7-12 months.
what do you pros think?

mrcow

For that amount and over that period of time then the Cahoot Flexible Loan IMO would be a good option as you can flex your payments as required, they don't insist on payment protection and they are extremely straight forward to deal with.

It's important to note that the 6.9% is a special offer and is only a typical APR, so the actual rate you are offered may be higher than this and will increase after 12 months (but you're intending to clear this within this time anyhow). Check the site out for full details.

The other option (if you're looking to pay this off in under a year) could be to go for a 0% credit card deal and pay it all of during the offer period. You'd need to check out the credit card section of the site, as I'm not sure what the best deals are on SBTs at present, but as many companies have been introducing charges of late, it may well not be a preferable option as you'd only be paying £20 or so in interest at 6.9% over 9 months in any case.

fatboyonadiet

Swithc for sure, as long as they won't charge you and do it ASAP and save some pennies!