Best way to pay off current loan

stefan1993

Hi there,


I am new to the site and am just after a bit of help with regards to my loan I currently have. I have a loan with the outstanding balance of £2810.28 , I currently pay £168.41 and have 18 months left on this term which has an interest rate of 9.9%. The closing figure I have been quoted is £2958.75.
I am just wondering the best way to pay this off? As I have £10,000 in an ISA with the same bank or do I get a 0% spending card and pay it off monthly still but save myself the interest? or do I just use my savings and pay the loan off and restart saving.
The only reason I mention the 0% spending card is because I can get accepted for most cards with 26-30 months 0%, this card would also help me pay my car insurance which is due soon and for the year it costs £860 if I paid the lump sum saving me £160 in interest if I paid monthly.


Any help would be appreciate my head is in a spin!

foxy-stoat

I would use your savings and clear the loan now, then pay an additional £168.41 a month into your savings ISA for the next 18 months.

MoneySavingAtWork

I'd take the same solution. If you have that £10,000 available to you it makes sense to use it to pay off your existing loan unless we are missing something and then use the £168 monthly payments to continue building it up.
The credit card approach is assuming you would get a credit limit great enough to pay the loan and it would mean you have new (albeit shifted) debts and a credit search conducted on you which will make it more difficult to get credit in the future compared to the first solution should you need it. There will also be a charge for the credit card, 0% plus a small fee depending on which product you are looking at