Help in getting a good deal on Loan

garooba

We needed to buy a new car as our old one was a MOT failure.

We got a loan from Halifax for £4,000 to pay over 5 years at £82 a month with 8.9%. The amount that is coming off a month is very low.

We would like to know if we can get a loan from another provider and pay more each month but unsure of how much payment will be coming off if we paid a lower APR such as 6.9%.

We would like help in getting a better loan deal please.

DCFC79

garooba wrote: »

We needed to buy a new car as our old one was a MOT failure.

We got a loan from Halifax for £4,000 to pay over 5 years at £82 a month with 8.9%. The amount that is coming off a month is very low.

We would like to know if we can get a loan from another provider and pay more each month but unsure of how much payment will be coming off if we paid a lower APR such as 6.9%.

We would like help in getting a better loan deal please.

Where does the car come into it ?

If your wanting a new car why not use the £4k loan ?

You could in theory get another at a cheaper rate and use that to pay off the 8.9% loan. Whether you could get accepted for a loan at a cheaper rate is anyones guess, depends on many factors, your credit file for 1 plus the information you provide at application.

[Deleted User]

The difference between 8.9 apr and 6.9 wouldn't really be worth the paperwork, does the loan from the halifax allow regular over-payments? That would make a difference.

garooba

I am using the loan to pay off the car.
I would have to check the paperwork to see if it allows over-payments. I was hoping that a cheaper APR would help to pay off quicker so I am looking at how I can find cheaper APR and need to know of any good websites please

DCFC79

garooba wrote: »

I am using the loan to pay off the car.
I would have to check the paperwork to see if it allows over-payments. I was hoping that a cheaper APR would help to pay off quicker so I am looking at how I can find cheaper APR and need to know of any good websites please

Good websites for what ?

A cheaper apr would help yes but it depends if you can get a loan with a cheaper rate than the 8.9% and if the curreng lender allows overpayments or even one off payments.

Nebulous2

8.9% is a good rate for what is a relatively small loan. You get better rates for higher loans, often over £7500.

The reason you are paying off so little every month is that you took it over such a long period. 5 years is a very long time for what I presume is an older second hand car. You could well have another MOT failure in that time, need a new one while still paying for that one.

There are lots of options to resolve the situation you're in but some of them will depend on lenders letting you get more credit.

Best option would be to simply overpay. Loans more or less all allow that. Agree what you want to pay, let Halifax know and off you go.

Other options would be to go to another lender for a shorter loan, though you may be refused or go to Halifax and ask for a shorter loan to repay that one.

Nebulous2

Here's a loan calculator for you here.

£4000 at 8.9% costs you £82.84 a month, with £970.37 in interest over that time. 6.9% costs you £79.02 per month,with £740.97 in interest, saving almost £230 in interest.

Reducing the term to 2 years, still at 8.9% costs £182.56 a month and £381.33 in interest. Almost £600 less than the 5 year loan.