Confused by early loan resettlement figure - help?

lornathewizzard

So we have a loan currently from Halifax at 19.9% APR. Having recently opened a joint account with Nationwide I did a loan calculation out of curiosity and found we could hugely reduce the interest - ended up with 4%, no brainer right?

Having got an early settlement quote from Halifax at start of Jan it was £6576.17. By the time the loan was sorted we had made a further payment to the Halifax loan of £223.10 (and more interest added of £101.59). So i thought i'll wait til the settlement quote expires and get a new one (today).

To my (probable naive) surprise the new settlement quote is higher - £6637.69. Yes more interest has accrued but also we've made a payment amounting to about the same. In relation to the current balance the first quote was about £33 higher and the new quote is about £215 higher!

Now luckily I could pull money from other places to cover this but I don't particularly want to! Should we contact them about this or does this sound right? Anything else I can do? It is husbands name and he won't be able to contact them til Saturday prob and I want it sorted (and they don't have an email contact grrr).

I know that we are saving a lot of money overall and I'm thankful but this just seems a bit rubbish.

Thanks in advance

[Deleted User]

It sounds as if your first quote was a current balance figure, rather than early settlement.

Query it with them.

lornathewizzard

Thanks, I did wonder if last months was wrong rather than this months. However definitely an early resettlement quote as everytime I went into the 'get resettlement quote' bit on their website it came up with the same figure. Wish I'd just paid it now.

foxy-stoat

I really wouldn't worry about paying another £33 more as by the looks of it you have been burning money every single month since you agreed an interest rate of 19.9% for this loan.

Get it clear chop chop.

lornathewizzard

foxy-stoat wrote: »

I really wouldn't worry about paying another £33 more as by the looks of it you have been burning money every single month since you agreed an interest rate of 19.9% for this loan.

Get it clear chop chop.

Well its more than £33 now but yes your point remains. Circumstances were different then though. I will appreciate the £1300 saving in interest we made rather than the extra payout now

Gaz83

Have you personally been guaranteed an interest rate of 4%, or is it just a representative quotation?

Not every applicant gets the headline rate, remember.

lornathewizzard

Gaz83 wrote: »

Have you personally been guaranteed an interest rate of 4%, or is it just a representative quotation?

Not every applicant gets the headline rate, remember.

Yes loan is in the bank

System

lornathewizzard wrote: »

To my (probable naive) surprise the new settlement quote is higher - £6637.69. Yes more interest has accrued but also we've made a payment amounting to about the same. In relation to the current balance the first quote was about £33 higher and the new quote is about £215 higher!

Now luckily I could pull money from other places to cover this but I don't particularly want to! Should we contact them about this or does this sound right?

It sounds right. If you early terminate most loan agreements state they will charge 56 days interest. I bet if you look at the terms and conditions of your loan in the early repayment section it will mention the 56 days interest.

lornathewizzard

Yeah it states 58 days I checked it this afternoon. So I think last month's was wrong . Annoyingly

Xbigman

If a payment goes through between asking for a settlement figure and it being generated that will affect the amount. Likewise, some settlement figures take into account a payment about to go through but which might not of actually been paid at the time the figure is generated.



Darren