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Is there a better way
chrisd8780
Posts: 58 Forumite
Took out a loan last year and got 3.2 percent. I am paying 156 a month and affording it I'm just a bit ocd and like to know I'm not overpaying. There is 5500 left on the loan(settlement figute)
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Comments
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Overpaying would be wise if you want to clear it earlier and save on interest.
Use an online calculator to see the impact.0 -
3.2 is pretty low for a loan. Some people's mortgages are higher than that.0
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AnotherJoe wrote: »3.2 is pretty low for a loan. Some people's mortgages are higher than that.
hmmm, you're assuming thats an APR figure . It may not be !!!0 -
chrisd8780 wrote: »Took out a loan last year and got 3.2 percent. I am paying 156 a month and affording it I'm just a bit ocd and like to know I'm not overpaying. There is 5500 left on the loan
The only way you can get cheaper borrowing would be by a money transfer credit card, clearing this loan and repaying it all before the end of the 0% interest period.
I think you should keep paying what you have as its a headline rate that folk on here complain that they cannot get.
Well done0 -
It depends on if it is compound interest - where the capital/interest split of your monthly payments is weighted towards paying more interest at the start of the loan, less towards the end.
If you want to know if its worth moving the debt, ask for a settlement figure for your current loan, get a quote for this amount on another loan and compare the total amount repayable. Chances are your current loan will be less.0 -
Thanks for the replies. Cheapest money transfer card I am likely to be accepted on has 3.94 percent fee so maybe better off sticking in this case0
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MattTheMoneyGuru wrote: »It depends on if it is compound interest - where the capital/interest split of your monthly payments is weighted towards paying more interest at the start of the loan, less towards the end.
If you want to know if its worth moving the debt, ask for a settlement figure for your current loan, get a quote for this amount on another loan and compare the total amount repayable. Chances are your current loan will be less.
Just curious, can you name any product that doesn't use compound interest? APR is designed around this, which makes prices easily comparable- just see which has lower %.0 -
I'm imagining the OP just wants to pay it off quicker as £5,500 seems a lot to them.
Keep paying it off and in 12 months time it won't seem as daunting!Savings as of April 2023 Savings account - £26460.50(14474.88)Current account - £2140.24(4576.79)Total - £28600.74(19051.67) £1010 (£65pm CS/BS) £250 CS/BS/JS0
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