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Loan from AA - APR Change
Cardinal-Red
Posts: 664
Forumite
in Loans
Hey guys
I've a loan with the AA which is at 8.0% and was for an initial sum of £25,000 - this was the best we could get at the time. The term was 6 years - 9 months of it have gone all paid OK.
Today the AA phoned and gave the spiel about 'valued customers' etc and said they could reduce our rate to 7.3% if we take more borrowing - minimum of £1000 but maximum of £15000.
Now we've no real need for extra cash at the minute but I tried to work out if it would be worth borrowing £1000, benefiting from the reduced rate, and just sitting the £1000 in our current account and using it to pay off the loan for 3 months. But when I tried to do the sums, I couldn't quite get my head around the figures.
So on the basis that the AA would only offer this deal if it makes them more money, am I best avoiding it? Is there anything I should be aware of with this?
Cheers guys!
I've a loan with the AA which is at 8.0% and was for an initial sum of £25,000 - this was the best we could get at the time. The term was 6 years - 9 months of it have gone all paid OK.
Today the AA phoned and gave the spiel about 'valued customers' etc and said they could reduce our rate to 7.3% if we take more borrowing - minimum of £1000 but maximum of £15000.
Now we've no real need for extra cash at the minute but I tried to work out if it would be worth borrowing £1000, benefiting from the reduced rate, and just sitting the £1000 in our current account and using it to pay off the loan for 3 months. But when I tried to do the sums, I couldn't quite get my head around the figures.
So on the basis that the AA would only offer this deal if it makes them more money, am I best avoiding it? Is there anything I should be aware of with this?
Cheers guys!
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