Loans - Early Repayment

sell_2

Hello, I need your advice!

I need a short term loans to help finance an extension (approx 1/3 of the total cost), then will re-mortgage on completion. I want to keep the monthly payments down as low as possible.

Tesco 8.7% - 30,000 over 10 years. £270 pm approx. Early repayment up to 2 months. This is the best rate I can find.

BOS 6.8% - £25,000 over 7 years. £370 approx. Early repayment, 53 days interest up to £100.

So my question is (without sounding too stupid!), how does early repayment work?

Would it be £30,000 less payments paid, plus 0.02% (8.7/365) interest x 60 days (roughly £360) if looking at Tesco Loan?

Thanks in advance

bengalknights

Your calculation is about correct its usually upto 2 months interest penalty on the principal outstaning

jonesMUFCforever

It will depend.

Why not re-mortgage now asking for the whole amount?

sell_2

Thank you, I was just worried we would end up owning more than we actually borrowed!

sell_2

Unfortunately, we don't have the equity in the house as only bought it a couple of years ago. Ideally we would save up the full amount but we need to make adaptions urgently for wheelchair use.

PeacefulWaters

sell wrote: »

Unfortunately, we don't have the equity in the house as only bought it a couple of years ago. Ideally we would save up the full amount but we need to make adaptions urgently for wheelchair use.

Can you get any local authority grants?