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Egg Top up Loan - Rate Change

edited 30 November -1 at 1:00AM in Loans
4 replies 2.9K views
chowsterchowster Forumite
86 posts
edited 30 November -1 at 1:00AM in Loans
Hi all, wondering if someone with more mathematical skills then me can help..

I have an Egg loan at the moment that has about 2 years left to run (approx 5k) at 10.9apr. Egg are offering me a top up loan which I would normally say no to but if I do accept it the WHOLE loan goes down to 7.9Aapr. I need only borrow a further 500 pounds for 7.9apr to apply to the whole loan.

Is this worth doing, ie will I save money by doing this or not?

Replies

  • Hey! :)

    Well let me see if I have this correct..

    £5000 at 10.9%, you are currently paying £545 a year interest.

    £5500 at 7.9% you will be paying £434.50 a year interest.

    I hope this helps and the figures are correct. Please, if anyone thinks they are wrong, please put me straight. I would hate for chowster to make a wrong decision based on my crappie figures! :o)

    James

    Update: Also to add to this, I have an Egg loan too, and I know that if you have more money one month you can pay some back with no penalties at any time :D Which is nice ;D
  • Thanks for the reply.. ;D

    Yeah seems a strange way of saving money doesn't it to get into more debt but the guy at egg said that if I did this I would save money... Wasn't just going to say ok then without thinking about it first....but your reply certainly makes it look viable..

    cheers

    chowster :)
  • Since there is no early repayment penalty on egg loans you could pay back the extra £500 of borrowing straight away and save a little more interest.
    Charles J
  • Since there is no early repayment penalty on egg loans you could pay back the extra £500 of borrowing straight away and save a little more interest.

    Very good point creditman thanks.....!! ;D ;D ;D
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