Loan Intrest charges

Shapy1

Hi my Son has just informed me he took a Loan out for £13000, 2 years a go over 5 years hes paying over £300 a month and of that £100 is interest so ive worked it out hes paying over £6000 interest this seems a bit much not knowing about Loans just wondering is this the norm ? .

[Deleted User]

It is, depending on the APR.

But his £300 payment isn't £200 capital and £100 interest. The capital element will increase on a monthly basis, as the interest decreases.

There's no need to guess at the interest which will be paid - it will be stated on the loan documents - along with the APR.

foxy-stoat

Shapy1 wrote: »

Hi my Son has just informed me he took a Loan out for £13000, 2 years a go over 5 years hes paying over £300 a month and of that £100 is interest so ive worked it out hes paying over £6000 interest this seems a bit much not knowing about Loans just wondering is this the norm ? .

I do not think you have worked out that right;
60 x £300 = £18,000
So by your figures its £5000 interest - about 14% APR

There MAY be cheaper loans out there but for him but it was probably they only one he could get at the time.

He wont get a cheaper loan now as it will be for debt consolidation.